cloudpreneurs - mckinsey reveals fast growth of cloud adoption
Post on 19-Oct-2014
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DESCRIPTION
At Technomy 2012 in Tucson , Bertil Chappuis, Senior Partner at McKinsey & Company, explored how cloud technology is helping to boost business. His talk focused on the high trending growth of cloud services on enterprise, small businesses, and individual levels. Using Newvem’s AWS cloud usage data, Mr. Chappuis covered rapid cloud growth.TRANSCRIPT
CONFIDENTIAL AND PROPRIETARYAny use of this material without specific permission of McKinsey & Company is strictly prohibited
Cloudpreneurs
McKinsey & Company |
Cheap computing +
2
Small in-house server
$31.55/mo
Small Public Cloud Instance
$16.06/mo
McKinsey & Company |
Agility +
3
Minutes60-150+ days
IT
Contact IT
INTAKE
CUSTOMER VERIFIES AND DEPLOYS
Final Review
Project approved, PM
assigned
InfrastructureEngineering
T
M/W/F
2
6
BUILDTICKET
Manager assigns Engineer
Engineer builds VM
Engineer installs & configures OS
Second engineer completes QA
Engineer completes MVM Scan
Backup & Recovery
Network Monitoring
Complete
Verify specs / stack
Deploy
Verify
App Scan
SOLUTIONING
Infrastructure engineers,
Agency business owners and SI
design solution
3Follo
w up
meetings
4
Iteratio
ns
PR
OJ
EC
T M
AN
AG
ER
– O
ng
oin
g
ov
ersi
gh
t a
nd
co
ord
inat
ion
PR
OJ
EC
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AN
AG
ER
– O
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g
co
mm
un
icat
ion
an
d c
oo
rdin
atio
n
5
1
ARM contacts Agency CIO
Initial Executive
Review
Solution Review
High Level Review
T
M
Th
Agencies
Iterations
McKinsey & Company |
New experiences =
4
Social
Local
Mobile
Big-data
Rapid development / iteration
Heterogeneous clients
Bursty computations
Cloud
McKinsey & Company | 5
Entrepreneurial groundswell
Salesforce.comSalesforce.com Workday Workday
Intermedia Intermedia AWSAWS
Regional sales team HR manager
Small business owner IT Infrastructure manager
McKinsey & Company |
Explosive growth
6
Contracting
Fast
Rapid
Explosive
27%
23%
25%
25% 3-70x
1-3x
0-1x
0-0.5x
1 > 100 VMs under management, *annualized growth based on 5 months dataSOURCE: Newvem analysis of AWS instances under monitoring
McKinsey & Company |
Including enterprise
7
None
Selectivedeployment
Deployedat scale
2012
10
47
43
2010
58
37
5
Public IaaS adoption
SOURCE: McKinsey Quarterly Survey on information and technology strategy, 2010, 2012; n=532 CIOs
McKinsey & Company |
Not monolithic
8SOURCE: McKinsey Cloud Computing Survey, 2010, 2012
Public : <10%Private: 70%Remainder on traditional architecture
High
LowLow High
Degree of regulation
Complexity and data
interdependence across application
domains
▪ Banking▪ Insurance▪ Healthcare
▪ Manufacturing▪ Distribution▪ Transportation▪ High Tech
Public : 20-25%Private: 60-75%Remainder on traditional architecture
McKinsey & Company |
Security & regulatory barriers
9SOURCE: McKinsey Cloud Computing Survey, 2010, 2012
2010 2012
1
2
3
4
5
6
7
8
1
2
3
4
5
6
7
8
Security
Regulatory exposure
Skills
Business case
Interoperability
Cloud awareness
Changing business processes
Governance
McKinsey & Company |
Security issues can be mitigated
10SOURCE: McKinsey on Business Technology: Protecting information in the cloud
▪ Rigid policy based security approach
▪ Business-focused risk-management approach that engages business leaders
From To
▪ Focus on securing technology (networks, servers)
▪ Focus on securing information and processes
▪ One size fits all policies (i.e., “we’re going 100% cloud” or “we forbid cloud”
▪ Workload specific analysis to match risk with application and data criticality
▪ Specialized IT talent aligned to technology “towers”
▪ Integrated service managers aware of business implications
McKinsey & Company | 11 11
Incumbents under pressure
Source: McKinsey cloud initiative
Traditional Product ModelTraditional Product Model Cloud Purchase ModelCloud Purchase Model
Rev
enue
Up-
front
sel
l
Inst
alla
tion
serv
ices
Ong
oing
Mai
nt.
Rev
enue
Up-
front
sel
l
Tran
sact
Ong
oing
Usa
ge
McKinsey & Company |
Huge value at stake
12
Mini-computers + Transaction systems
PCs + Productivity SW
Client server +ERP
Cloud / SaaS +Mobility + Big Data
‘70-’80 ‘80-’90 ’90-’00 Now
Efficiency & record-keeping
Workgroup decision making
Standardization and efficiency
Innovation through insight and rapid execution of ideas