The rise of the Steath Cloud

One element of the debate was the rise of business initiated cloud computing, which the CIO may never hear about.  Something I'm calling the Stealth Cloud

Cloud Computing seems to have struck a chord in a way that ASP, OnDemand, SaaS and all the previous incarnations never have. Every analyst is blogging and tweeting about it, there are a slew of conferences, and a surprising number of books have already been published.

And there is now more than one sort of Cloud. There are Public Clouds and Private Clouds. I propose “Stealth Cloud” should be added to the lexicon.    As the name suggests is does its job – quietly, unseen, unnoticed.

Silver lining?

So business people are embracing the ideas of Cloud Computing. Why? Because they can see immediate value from the applications and services being offered.  And with technology becoming easier to develop there seems to be no limit to what is being provided in the Cloud, all packaged in a very compelling, fun user experience. 

Consumers are business people too

So when the individual is provided with these elegant services as a consumer it is inevitable that they bring them to work. With services such as on-line backup, project management, CRM, collaboration and social networking all available through a browser, is it any surprise business users are signing up and ignoring the staid and boring applications provided by the IT department.

Hence the rise of the Stealth Cloud.  Services being consumed by business users without the knowledge, permission or support of the CIO and the IT department.

The widening business IT divide

Too much has been talked about the Business IT divide. But unfortunately the Stealth Cloud has driven an even greater rift between business and IT.  It is exposing, as far as the business are concerned the lack of flexibility, agility and responsiveness of IT.  From IT’s perspective who can see the risks (operational, compliance and integration) of using some of these Cloud services, is simply underlines how cavalier and naïve the business users are.

Unfair rap

Corporate systems are costly to build and maintain. They are mission critical and need to support the entire operation.  So there is a good reason why the internal IT department cannot ‘knock-out’ application as fast as a nimble start-up.  The IT department is spending 80% of its time and effort ‘keeping the lights on’ and the remaining 20% on providing new solutions that are robust, scalable, secure and integrated into the core applications. How many of the ‘new’ Cloud providers are truly enterprise ready?
 

Confusion squared

BPM has multiple definitions, which was discussed in What Hat are You Wearing, and Cloud appears to mean anything which is accessed via the internet, unless it is Private Cloud and then it seems to be anything..... internet, intranet, WAN or even LAN. So let’s get some definitions sorted first. They may not be the definitions that everyone agrees on, but they will set the scope for the discussion here.

Definitions (do not skip this)

BPM – a business process management application which documents and executes a business process (eg Order to Cash, Idea to Product). By execute, I mean the process, which has both manual and automated activities, is accessed by an end user to get their job done. Examples of BPM applications (not necessarily Cloud) are Pegasystems Smart BPM , Global36 Process360, Software AG ARIS & Nimbus Control. So by Cloud App I mean an application and data that is not hosted by the client but by a 3^rd party and is accessed over the internet.

If you want to be a purist you would say that there is no local application installed on the client device apart from a browser, but that is not always practical for a range of reasons: access when no internet connectivity; access using mobile devices; data back-up.

A confusion that reigned at a recent event where I was on the Cloud panel was that people were talking about Processes in the Cloud in which they also included a 3^rd party delivering the processes on behalf of the client. An example would be Payroll or Call centre processes. I would describe as BPO (Business Process Outsourcing). Confusion cubed.

Potential?

So definitions set, what is the potential for BPM in the Cloud? Certainly the CIO in any organisation is looking at Cloud applications to be able to manage down cost, move CapEx spend to OpEx and potentially eliminate the hassle of running applications. But none of these decisions are made without taking a hard look at the risks and assessing the potential migration cost. Business leaders see Cloud Computing as a way of circumventing the IT logjam and getting ‘stuff done’. This is being done with or without the permission or even knowledge of the CIO. This is something I have coined the Stealth Cloud and am speaking about regularly at conferences such as the IT Directors Forum. So what are the risks?

The list of questions that need to be considered is long – in fact runs to 94 pages in my book Thinking of.. Buying a Cloud Solution? Ask the Smart Questions. (So not a fun read but critical!!!) And the questions aren’t all technical. Many of them are business and cultural. The technical questions can probably be answered more easily. So here are some of the question areas:

• Why are we considering Cloud Computing? These are questions around the benefits and opportunities that are achievable. What is motivating you?

• What do we need from the service? These are about your organization’s business and technical needs. Are there opportunity-led business benefits or is this simple cost reduction?

• What are the costs? Where are the internal costs of implementing Cloud Computing? What infrastructure upgrades, training costs, migration and licensing.

• What are the external barriers? There will be external limitations; legal, contractual, or physical that will need to be addressed. Some may be deal-breakers.

• Are we ready internally? What are all the activities that need to happen to fully exploit Cloud Computing? Is the organization in a position, emotionally, financially and technically, to implement Cloud Computing?

The future is already here

Some say that the future is already here, but it is unevenly distributed. By that we mean that if you look around you can find examples of any new innovation being used in anger, delivering business benefits, it’s just that not everyone is using it. A recent survey by Information Age highlighted the top 10 Cloud Computing systems. What is interesting is that they are currently all 100% hosted.

None of them has any locally installed software. Whilst this may be the best route for some systems, and is certainly the ideal answer for a consumer system, it is not necessarily best for an enterprise customer. They may require the local processing power of a PC for some analytical or reporting, but also the system needs to recognize when users are not connected and allow them to continue working, albeit with slightly reduced functionality.

But what of BPM in the Cloud

There are now a large number of vendors who have a Cloud based offering. Many of them pre-date the Cloud. Nimbus Control’s User Centric Process Management application has been available and used as a hosted offering for over 5 years. The service originally branded JumpStart as it was expected that it would be used for early stage pilots. But it became very rapidly obvious that clients wanted to use the service longer term for full production, or at least for several years until they had their own infrastructure in place.The roster of over 100 clients who have used the Nimbus Cloud is impressive;  Cognos, SAP, Nestle and Carphone Warehouse..... And many of these are still using it every day. For example Carphone Warehouse in the video below.

Other examples are more workflow or document centric BPM vendors who have launched Cloud offerings are are Pega, who are leaders in Gartner’s BPMS Magic Quadrant, and Vitria. Lombardi, recently bought by IBM has had a Cloud based modelling tool for a couple of years, but their BPMS engine is still on-premise, but with IBM’s support for Cloud it is only a matter of time. And if the Cloud is written about Salesforce.com is inevitably referenced. In the BPM context they have just acquired Informavores which is a workflow product which enables Salesforce.com transactions to be strung together which has been rebranded Visual Process Manager.

The final word?

BPM and Cloud has a place in the technical architecture of many companies, but only once the non-technical issues have been resolved. And you should look for benefits in terms of better joined up thinking across geographies and speed to deployment rather than straight technical cost savings.