Forbes OracleVoice 11/19/13
By Bob Evans, Oracle
In today’s always-on world, businesspeople who’ve never even stepped inside a data center are learning that data-center breakdowns trigger nightmare scenarios involving staggering amounts of lost revenue, customer disenchantment, plummeting employee productivity, and battered brand image.
As a result, many companies are placing greater scrutiny than ever before on the cloud providers they choose to handle mission-critical parts of their business. And as cloud computing surges from the fringes of the business world into the mainstream, those decisions are becoming top-priority issues for not just the CIO but the CEO, the CFO, and even boards of directors.
As the holiday season kicks into full swing, say your E-commerce cloud provider suffers an outage that lasts for a few hours. How much will that cost your business in lost revenue? How many customers will click over to your arch-rival and, within a matter of seconds, strike up a relationship that you spent months or years fostering?
And how quickly will your general counsel be on the phone with your cloud provider to begin discussing contractual repercussions and make-goods? Because cloud data-center outages aren’t merely theoretical—they happen fairly often, and you can be 100% certain that the related business costs are significant.
One recent research study reports that the cost of unplanned data-center downtime will likely be more than $5,000 per minute—or more than $300,000 per hour—and for some it’s clearly even worse than that. And in a followup study released this year, 17% of respondents said they would lose more than $500,000 per hour, with another 6% estimating that the cost of such outages would top $1,000,000 per hour.
Those eye-popping numbers are due in part to the deeply integrated and synchronized nature of today’s high-volume, high-velocity businesses, in which business applications are also tightly integrated. Order-management apps tie into inventory, scheduling, purchasing, financials, distribution, supply chain, and so forth—none of these apps operates in an old-fashioned silo anymore.
On top of that, the Big Data and analytics systems that are becoming the lifeblood of many companies can’t deliver the necessary insights when vital applications have been frozen due to a data-center outage.
The problem with these nightmare scenarios is not cloud computing—rather, it’s the level of quality and reliability and scale that the provider behind your cloud-computing solution can provide. As is the case in any market sector, there’s a range of quality and capabilities in the cloud world—some superb and rock solid, others not so much.
And as the stakes for business success in today’s global consumer-driven economy rise dramatically, more companies will realize that they can’t afford not to be aligned with the superb and rock-solid players.
So What’s The Answer?
Leading SaaS cloud providers today are expected to have multiple layers of fault-tolerance and redundancy for all key points of failure: redundant data centers, fast recovery mechanisms, experienced personnel in place at all times, and battle-hardened security practices built-in at every layer.
In today’s world of always-on businesses and highly integrated applications and processes—not to mention increasingly stringent demands for privacy, compliance, and regulatory rigor—here are some suggestions for what a truly next-generation cloud provider should offer as its data-center best practices:
1) Deep Financial Commitment. Proven and ongoing investment in top-of-the-line data center infrastructure: network, systems, storage and applications. Does your SaaS provider own and manage each and every layer of the technology stack that power your cloud applications, or do they outsource all of those high-value assets to yet another third party? That’s one measure of its commitment to being a world-class provider, rather than relying on someone else to manage that risk.
2) Expert Personnel and Policies. How comfortable are you with the data-center personnel and governance policies of your SaaS provider? Do they have world-class experience, or do you have the feeling they’ll be learning on the job with you and your company as the lab rats?
3) Global Assets for Global Businesses. Does the provider offer multiple data center locations across the globe with redundant data centers that meet or exceed local standards for data residency, disaster recovery, and regulatory compliance?
4) Domain and technical expertise. Does the provider employ data center personnel who are experienced and experts in not only core data-center technology but also the platform and the entire technology stack upon which the future of your business will be placed: from applications to servers and storage to security and networks?
5) Isolate Customer Data. Does the provider effectively separate your data from the data of other customers sharing the same infrastructure, or do they place all of the data—your data, unrelated companies’ data, but also possibly your competitors’ data—in the same monolithic database?
6) Multiple Layers of Security. Does the provider insist upon data-center tools and security practices that protect data at every level of the stack? Are there dedicated cloud security experts using these tools and applying best practices, or does your provider subscribe to the jack-of-all-trades approach?
7) Full Support for Internal and External Audits. Does the provider conduct frequent internal audits by cloud security experts, as well as periodic auditing by an external entity?
All in all, there are varying levels of these cloud management practices occurring today across the industry. It is not just prudent but indeed essential to the future viability of your business for you and your team of experts to look closely under the hood of your SaaS cloud provider when managing mission-critical data.
With cloud computing all the rage in today’s business world, it can be tempting to believe that marketing hype put out by some providers that want businesses to believe that all clouds are built the same. But nothing could be further from the truth.
As businesses expect more from the cloud, and as they place increasingly critical elements of their business in the cloud, the difference between success and failure will be defined by the quality and professionalism and technical expertise of the cloud provider.
At the end of the day, execs need to be focused on growing the business, not worrying about the cloud powering that business. It’s critical to remember that while you are still buying a business application, it’s being delivered as a service. The quality level of that service and how it lines up with the rest of your business priorities are just as important to consider.