Navigating your path to cloud success: A study of rogue workloads, vendor lock- in, and cloud conflicts

Executive SummaryAs organizations adopt cloud technology at a steady pace,

they are encountering issues that threaten to derail the

benefits cloud can bring. A survey by IDG Research Services

reveals that organizations face confusion in researching cloud

options, forcing them to adjust goals and search for more

flexible and open cloud solutions that can help them prevent

vendor lock-in. What’s more, the survey shows a disconnect

between IT and business users regarding the intended goals

of a cloud deployment. It’s clear that companies could use

an independent third party to help guide them through the

ambiguity surrounding cloud and get all stakeholders pulling

in the same direction, to ensure cloud projects fulfill their

potential and meet business goals.

2Navigating your path to cloud success

Conflict of the CloudThere’s little question that cloud technology is maturing. In a survey of nearly 2,000 IT leaders

conducted in 2012 by IDG Enterprise, more than half said they had at least one cloud application

already deployed and another 25% said they planned to deploy within a year. By the end of this

year, fully three-quarters of the respondents will likely have cloud applications deployed.

With that kind of adoption rate, it’s no surprise that some issues are arising, as illustrated by

another, more recent survey conducted by IDG Research Services on behalf of Dell. Respondents

report issues such as confusion when researching cloud deployment options and having to adjust

goals in midstream when a solution does not work as expected. The survey also makes it clear

that business executives and IT often have dramatically different—and potentially conflicting—

goals for cloud deployments.

Further, the survey finds that organizations are seeking more flexible and open cloud solutions,

to ease fear of vendor lock-in and help them meet internal requirements. Companies are also

grappling with “rogue” cloud deployments that originate outside the IT department, often with

different security standards and end goals in mind.

Two-thirds of respondents admit that researching various cloud deployment options is a confusing process. Three out of five agree their organizations sometimes need to adjust the end goal of cloud projects due to rigid solutions.

Strongly Agree

Somewhat Disagree

Somewhat Agree

Strongly Disagree

Neither Agree nor Disagree

Researching various cloud deployment options is sometimes confusing.

Sometimes we need to adjust the end goal of our cloud projects

due to limitations or lack of flexibility with the cloud solution.

My organization has had difficulty finding a cloud vendor who can

easily match their solutions to our business goals.

Fear of vendor lock-in is inhibiting cloud deployments

at my organization.

25% 66%

17% 60%

14%

21%

42%

43%

39%

31%

17%

26%

26%

21%

12%

11%

13%

19%

4%

4%

8% 53%

8% 52%

Strongly/Somewhat

Agree

SOURCE: IDG Research Services on Cloud Strategy

3Navigating your path

to cloud success

The survey results make it clear that CIOs need an overarching strategy for dealing with cloud

applications in order to make the most of the technology, and to ensure they meet their busi-

ness as well as personal career goals. Using a third-party provider to offer vendor-neutral expert

advice, along with some crucial tools to address areas such as integration and security, can

greatly help CIOs achieve their cloud objectives.

IT Issues with CloudThe issues with respect to cloud begin with selecting a solution; indeed, two-thirds of respon-

dents to the IDG Research Services survey say researching various cloud deployment options is

sometimes confusing.

John Ragsdale, CIO with BerylHealth, a hospital services provider based in Bedford, Texas, is one

of those respondents. While he does not have much trouble researching providers, he says it can

be confusing to compare the various licensing and pricing options for cloud solutions with what it

would cost to build the same solution in-house.

“With the cloud option everything is included in one price, so you have to parse it out [in order

to get an apples-to-apples comparison],” he says. “We’ve had to go through that analysis.” The

company started using software-as-a-service (SaaS) applications in 2011 and currently uses

Salesforce.com to provide cloud-based customer relationship management, marketing, project

management, reporting, and more. It also uses cloud-based solutions from Oracle for chat,

Microsoft Dynamics GP for enterprise resource planning, and additional vendors for its data inte-

gration and single sign-on.

BerylHealth is not alone in evaluating and using multiple cloud-based applications. In such situa-

tions, it may be useful to hire a third-party partner to perform an unbiased evaluation of the build

vs. buy equation and to compare vendor offers in a meaningful way.

“ With the cloud option every-thing is includ-ed in one price, so you have to parse it out [in order to get an apples-to-apples comparison].”

—John Ragsdale CIO

BerylHealth

At least four out of five respondents report the flexibility and simplicity of current cloud solutions need at least some improvement to meet their standards.

Flexibility (choice of standards or platforms, ability to work with

multiple vendors or platforms, works with existing installed technology)

Simplicity (integrates easily, stream-lines management, deploys quickly)

Performance (speed, scalability, security, efficiency, reliability)

87%

84%

73%

Significant/ Some

Improvement needed

SOURCE: IDG Research Services on Cloud Strategy

38%

38%

33%

49%

46%

40%

7%

10%

20%

2%

2%

2%

Significant improvement needed

Little improvement needed

Some improvement needed

No improvement needed

4Navigating your path to cloud success

Lack of flexibility

Sixty percent of survey respondents also say they sometimes have to adjust the end goal of

cloud projects due to limitations or lack of flexibility of a vendor’s cloud solution. Similarly, 53%

say they have had difficulty finding a provider who could match their solutions to the company’s

business goals.

BerylHealth struggled early on with getting Salesforce.com to meet its needs. “We customized the

application function quite a bit,” Ragsdale says, noting he initially used an independent contractor

to help. “He didn’t grasp the concept. So we had to work with Salesforce and their professional

services people.” It took some time, but now the company is happy with the results and continuing

to build new applications upon the Salesforce platform.

As his experience shows, although SaaS solutions are touted as “out of the box” solutions that users

can simply drop into their enterprise, in practice it often takes work and budget to align the solution

with a company’s particular business processes and existing applications.

Fear of vendor lock-in

Another difficult issue with cloud is fear of vendor lock-in, which 52% of survey respondents either

somewhat or strongly agree is inhibiting cloud deployments at their organizations. Only about one-

quarter of respondents say they have no problem with the issue.

“Vendor lock-in is a big concern,” says another survey respondent, Randy Cairns, CIO with American

Enterprise Group, an insurance company in Des Moines, Iowa. He has about 450 employees using

a SaaS-based CRM application and all of the company’s 600 employees use a cloud-based human

resources administration application.

Firms can mitigate some of the vendor lock-in risk by picking providers that support industry

standards and standards-based integration where it is available. They can also adopt a multicloud

architecture that provides them with more flexibility in deploying across private, public, and hybrid

configurations. Critical to this approach are management and integration, which if built in from

the beginning, can control and construct meaningful workflow across cloud applications and

infrastructures. If designed correctly, a multicloud architecture can enable choice across vendors

without the costs and risks of locking into single vendor silos.

Openness and simplicity

The lock-in issue relates to how flexible and open a cloud solution is. Flexibility—meaning the

choice of standards or platforms and the ability of an application to work with other platforms

and existing technology—is the area survey respondents say is most in need of improvement with

respect to cloud applications, with 87% saying some or significant improvement is needed.

“Without any open standards, you’re in bed with whoever’s integration or tool, or whatever it is

you’re using,” Cairns says. “We’re looking at the Windows Azure model because we’re a big VMware

shop and [Azure] integrate[s] pretty well with that.”

Simplicity of the cloud solution was next in line in terms of what respondents say needs

improvement, at 84%.

“We all want simplicity in everything we do,” Cairns says, noting it is an area where cloud applica-

tions could take a page from vendors such as VMware. His company has some 400 servers to

monitor, about three-quarters of them virtual. “VMware gives me a good tool to help make that

manageable. We’re just not seeing that soon enough for the cloud,” he says, noting some cloud

vendors don’t give customers a window into their applications to monitor performance.

“Without any open standards, you’re in bed with whoever’s integration or tool, or what-ever it is you’re using.”

—Randy Cairns CIO

American Enterprise Group

5Navigating your path

to cloud success

Performance

Customers would also like to see improvement is performance of cloud applications, with 73%

saying some or significant improvement is in order.

“Salesforce performs well but you have to architect it right,” Ragsdale says. For example, you can’t

render as much data per page with Salesforce as you can with traditional in-house .NET applica-

tions, he says. “As long as you understand that, work with it, and have some expertise, it’ll work. If

you don’t have that expertise I could see where it’d be very frustrating.”

The Cloud Conflict WithinOther issues with respect to cloud applications have more to do with organizational challenges,

security requirements, and stakeholder expectations than technology. In some important respects,

the business and IT groups are simply not on the same page when it comes to cloud or the busi-

ness strategies that require cloud.

Rogue cloud deployments

For example, many survey respondents report that cloud projects originate without the consent of

IT management. Application developers and line-of-business (LOB) groups such as finance, sales,

or marketing are the most frequent originators of such “rogue” or “shadow IT” deployments, with

65% of respondents saying they initiate cloud projects either often or occasionally, followed by

executive management (64%), individual users (49%), and smaller departments or groups within LOB

units (48%). When application development staff circumvents its own IT processes and platforms

to acquire outside capacity, it is not only problematic but a true manifestation of cloud conflict and

misalignment of objectives within organizations.

In some impor-tant respects, the business

and IT groups are simply not

on the same page when it

comes to cloud or the business strategies that require cloud.

Most frequently, cloud initiatives originate from corporate IT. About two-thirds of respondents report application developers, lines of business, and executive management (non-IT) initiate cloud projects at least occasionally.

Corporate IT

Application developers

Lines of business (e.g., finance, sales, marketing)

Executive management (non-IT)

Individual users

Smaller departments or business units within lines

of business

49%

26%

17%

22%

15%

14%

41%

39%

49%

42%

34%

34%

10%

17%

22%

19%

27%

31%

1%

17%

12%

16%

19%

18%

89%

65%

65%

64%

49%

48%

Often/ Occasionally

Often RarelyOccasionally Never

SOURCE: IDG Research Services on Cloud Strategy

6Navigating your path to cloud success

Take a Simpler Path to Cloud Cloud-based applications and services can

deliver great benefits for companies that imple-

ment them well, including relieving the burden

on IT so it can focus on helping the business

achieve its goals. But achieving success with

cloud services often comes down to choosing

the right partner.

Dell’s approach to cloud can be summed up in

three words: open, integrated, and secure.

Open Dell adheres to many open industry standards

to help its customers build flexible solutions.

One example is its support for OpenStack,

the open source cloud computing platform

for public and private clouds. Dell is a Gold

member of the OpenStack Foundation, which

promotes the development, distribution, and

adoption of the OpenStack cloud operating

system.

Technologies such as OpenStack improve

choice while reducing costs for customers. It

also enables Dell to leverage an industry-wide

community to deliver tailored solutions for

customers, over a standardized infrastructure.

It’s another in a long line of open, standard

technologies that Dell supports to increase

choice and prevent lock-in for customers.

IntegratedThat openness also enables Dell to deliver

cloud solutions that integrate well with a

customer’s existing hardware, software, and

services. Customers can leverage their existing

investments, while saving time and money.

Additionally, Dell Multi Cloud Manager enables

customers to control their multivendor

private and public clouds from a single place.

Customers use design tools that are “vendor

agnostic” to define architectures and polices

for automatically managing cloud application

deployments, auto-scaling, application migra-

tion, disaster recovery, and backup snapshots.

And, Dell Boomi provides an easy and cost-

effective integration platform, extending the

value of existing applications. Boomi Atom-

Sphere® connects any combination of cloud,

SaaS, or on-premise applications using original

APIs, with no appliances, software, or coding.

Boomi can drastically reduce implementa-

tion times while delivering rapid time to value

and substantial cost savings as compared with

traditional integration solutions.

SecureSecurity of a cloud solution should be more

robust than what a typical customer organiza-

tion can provide on its own—and that’s just

what Dell delivers. Indeed, security is a core

competency at Dell, from the device to the data

center. Dell offers multiple layers of security for

cloud computing and embeds security deeply

within in its own cloud offerings.

At the device level there’s Dell Data Protec-

tion Encryption, a component that installs

on Dell desktops, laptops, smartphones, and

other devices to deliver nonintrusive file-based

encryption as well as sector-based full disk

encryption—all managed centrally by IT.

For the data center, Dell offers its Dell

SecureWorks® Managed Security Services.

Offerings range from security monitoring,

vulnerability management, and log manage-

ment, to full lifecycle management and

monitoring of security appliances, including

network and application firewalls, intrusion

prevention and detection systems, and unified

threat management appliances.

Learn more about how Dell can help you

get the most out of cloud offerings. Visit:

www.dell.com/cloudservices.

Rogue deployments were an issue early on at BerylHealth, but the company addressed the issue by

putting governance procedures in place around all business and IT projects. So if a business group

did implement a cloud project without IT approval, IT would find out about it.

Governance is important to keep everybody on the same page and to ensure that cloud applica-

tions are implemented in a consistent manner. For example, Salesforce has a standard internal

object called a “case” that can be part of many use cases, Ragsdale says. If one group uses it in one

way and another uses it in another way, they could wind up overriding and conflicting with each

other. “It can spiral into lots of problems,” he says.

7Navigating your path

to cloud success

75% of the “State of the CIO” survey respondents agreeing that boards of direc-tors are more interested in IT today than they were three years ago.

Disparity in expectations

When cloud projects are not sanctioned by IT they tend to have different end goals in mind. Indeed,

the survey data points to a veritable chasm between IT and business groups with respect to their

objectives for cloud deployments.

When asked what the primary goal is for a cloud deployment that originates within their depart-

ment, between 36% and 41% of business users (depending on their role, from executive manage-

ment down to the smallest departments) point to business and organizational responsiveness—

easily the top response. When IT originates the project, nearly half say the goal is simply to increase

operational efficiency, and fewer than one-quarter point to business and organizational responsive-

ness. Only 6% of IT users say their primary goal is to increase productivity.

Such responses point to the need to have a company-wide strategy and collaboration when dealing

with cloud applications, to ensure “rogue” deployments are not simply geared to the benefit of

individual departments and are consistent with the company’s larger business and IT goals. But the

survey results show that does not appear to be happening consistently. When scoping out initial

goals, budget, and timelines for a cloud project, 80% of respondents say corporate IT is involved,

but only 46% say LOB representatives are involved and 37% say non-IT executive management is

at the table. The numbers drop even lower when it comes to forming a technical cloud strategy

and choosing a solution. While the perceived organizational investment may be high, the lack of

collaboration across the organization is an issue that needs to be proactively addressed.

Meeting CIO GoalsCIOs need to get a handle on these cloud issues if they want to meet their own personal

career goals.

According to the 2013 “State of the CIO” survey conducted by CIO magazine, today fewer than

25% of CIOs spend much time on business strategy functions such as driving business innovation,

developing and refining business strategy, and identifying opportunities for competitive differentia-

tion. But as many as 54% say those are the areas they’d like to be more involved with by 2016.

They may well get their wish, as reliance on IT is certainly growing, with 75% of the “State of the

CIO” survey respondents agreeing that boards of directors are more interested in IT today than

they were three years ago.

Easing the IT burden

The trick for CIOs is to leverage cloud as a way to make the IT infrastructure more reliable and

easier to operate. “Cloud offerings, even hosted services, have shown that there’s an easier way

to run all this stuff,” says Cairns of American Enterprise Group. “Most of what I spend my time on

is business initiatives.”

It should be no surprise that CIOs intend to increase the use of third-party IT service providers,

including those that offer cloud services. In 2013, about 25% of all IT services were supplied by third

parties, according to the “State of the CIO” survey. In three to five years, that figure will increase to

37%. Indeed, 36% of survey respondents say cloud is the trend that will have the most profound

effect on the CIO’s role in the future, topping other trends such as mobility, consumerization of IT,

big data, and social media.

8Navigating your path to cloud success

Wanted: A True PartnerIf they are to make the most of cloud, however, CIOs need to avoid the pitfalls that the IDG

Research survey points to. The survey makes clear that customers need to look for three attributes

in a cloud service provider, as follows.

Flexible, open, scalable

First, the provider must offer an open solution, one that’s flexible enough to integrate with other

cloud offerings. It should be capable of seamlessly supporting hybrid cloud environments that

include both private and public cloud offerings. And it needs to be highly scalable, to keep up with

demand as the business grows.

Easy to integrate

Cloud offerings must also integrate with in-house applications, such that customers can leverage

their existing investments. The provider must understand how hardware, software, and services

all work together to get the job done.

Simplicity

Cloud should be about simplicity, but multiple applications and vendors often bring complexity that

can negate real cloud benefits. Transforming the people, process, and technology toward cloud is

not enough; organizations need a partner that considers simplicity and the customization required

to enable the entire business.

Reliable and secure

And, of course, cloud applications must be highly reliable, always available, and secure. Nothing

will torpedo a cloud project faster than security issues or performance problems.

Dell at Work Fast facts about Dell:

• DellSecureWorks,acorecompetencyof

Dell Cloud Services, processes more than

50 billion security events daily.

• Dellmanagesmorethan6billiondiagnostic

image objects in the cloud for its customers,

providing critical support to more than

40,000 physicians and 500-plus individual

medical practices.

• DellBoomihandlesmorethan2million

integration processes daily.

• Aleadingpaymentprocessingservices

company saved more than $430,000 in the

first month alone, and more than $5 million

in the first year, after deploying a Dell cloud

solution for process integration.

• Dellstoresmorethan16petabytesofcloud-

based email—more data than the U.S. Library

of Congress

• Dellsendsoutmorethan15millionSMStext

messages, automated voice calls, and email

notifications every year.

• Morethan1billionpeopleworldwideare

connecting to the cloud using Dell solutions.

• AnITsolutionsproviderusedDellCloud

Services to seamlessly integrate three critical

business functions, reducing order entry

timeby85%andsaving$1millionincustom

development costs for SAP integration.

9Navigating your path

to cloud success

Getting Cloud RightAddressing these issues is paramount if CIOs are to successfully implement cloud and meet

their own business and career goals. Yet, as the IDG Research survey shows, too many offerings

today are falling short in terms of the kind of flexibility, simplicity, and security that can really

transform a business.

Companies seeking a partner that can help them get cloud right would do well to look at Dell. Dell

offers the cloud solutions that meet the criteria in terms of openness, ease of integration, simplicity,

and security. The company also has the experience and perspective that CIOs need to succeed

with cloud. Its solutions span from the desktop to the data center, including all required hardware,

software, and services. Through its transformation, modernization, and implementation services,

Dell is a trusted partner to many companies as they develop an overarching cloud strategy and

deliver successful cloud implementations. n

Learn more about how Dell can help you get cloud right. Visit: Dell.com/cloudservices.

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Additional resources

4 of 5 world’s largest law firms useDell for secure cloud EmailManagement Services

21 of 25 largest law firms in the USAuse Dell for secure cloud EmailManagement Services

The numbers are inSimple and secure cloud solutions from Dell

Dell Cloud securely storesmedical images for7% of the U.S. population 1

Over

1 billionpeople worldwideare connecting tothe cloud usingDell solutions

Dell Cloud now sends out more than

every year

15 million SMS text messages,automated voice calls and email

notifications

Organizations useDell Cloud storage for7.52 billionemails every day

5,000emails every minute

Dell stores over 16petabytes of cloud-basedemail — more data than theU.S. Library of Congress

#1in density-optimizedservers2

4

Dell SecureWorks is a Leader inManaged Security Services7

5

Dell does business with every Fortune 100 company 6

Dell performs

over 1 millioncloud integrations each day3

Dell is a leader in ,each day

managed security servicesmonitoring over 50B events

1.Basedon313,914,000censusestJuly1,20122.IDCWorldwide Quarterly Server Tracker,1Q13,May20133. http://www.boomi.com/news_and_events/press_releases/110220134.TheAmericanLawyer2012AMLAW100:FirmsRankedbyGrossRevenues5.TheAmericanLawyer2012AMLAWGlobal100:GrossRevenues6. http://www.marketingshift.com/companies/technology/consumer/dell.cfm

7.GartnerMagicQuadrantforMSSPs,NorthAmerica,2012.IDNumberG002298738. IDC IT Cloud Services at the Crossroads: How IaaS/PaaS/SaaS Business Models Are Evolving,

doc#DR2013_T6_RM_SH_MP,March20139. Gartner Demand for Cloud-Based Offerings Impacts Security Service Spending, ID Number:

G00249847

“In 2013, 85% of net new software will be built forcloud delivery”

“Cloud-based security services will account for 10%of the enterprise IT security product market by 2015”

98

Dell Cloud

Dell protects over

in the cloud

85million patient studies and 6 billion medical images