How to Sell Cloud Steve Heeney BPO Cloud Leader © 2011 IBM United Kingdom Limited Meeting Storyboard •Getting an interested customer •Cloud is hype •Cloud isn’t secure •What’s the value? •Working through Cloud solutions •More than one cloud •Building a business case •Client readiness •BVA •IBM resources •What type of Cloud BP do you want to be? © 2010 IBM Corporation Are you thinking about Cloud? Cloud is just virtualisation… An effective cloud computing deployment is built on a Dynamic Infrastructure and is highly optimized to achieve more with less! CLOUD Dynamic provisioning for workloads SHARED RESOURCES tin g Common workload profiles In inf tegr ra ate str uc with tu re exi s AUTOMATE Flexible delivery & Self Service STANDARDIZE Operational Efficiency VIRTUALIZE Increase Utilization CONSOLIDATE Physical Infrastructure Traditional IT “… the two biggest hurdles solution providers face as they make the leap to the cloud are their own sales force and their customers. … "If they [customer] can't see it, they feel © 2010 IBM Corporation very uncomfortable about it," [Bova said of customers‘ hesitance to move to the cloud. …]” (Tiffany Bova, VP Gartner Research, @ XChange 2010, March 8th 2010) Major Markets dominate in early Cloud adoption but the Growth Markets have a 10-15 CGR of 35% vs Major Markets with 24% Unit: $B (USD) Markets IMT (23) Major Markets US IMT Canada IMT Alps IMT Germany IMT Nordic IMT UKI IMT Italy IMT France IMT SPGI IMT BeNeLux IMT Japan IMT Major Markets Total Growth Markets Growth Markets Total Grand Total Korea GMR GCG GMR ANZ GMR ASEAN GMR ISA GMR Brazil GMR Mexico GMR SSA GMR RCIS GMR ECE GMR MENA GMR SubSA GMR 2008 21.2 1.2 0.4 1.7 0.7 2.8 0.6 1.2 0.6 0.7 1.8 2009 27.1 1.5 0.5 2.2 0.9 3.7 0.7 1.6 0.7 0.9 2.6 2010 35.9 2.3 0.8 3.1 1.3 5.0 1.0 2.1 1.0 1.3 3.7 2011 46.0 3.1 1.1 4.3 1.9 6.8 1.3 2.9 1.4 1.8 5.2 2012 56.7 3.9 1.5 5.9 2.5 8.8 1.8 3.9 1.9 2.4 7.1 2013 68.1 4.8 1.9 7.6 3.2 11.0 2.4 5.3 2.5 3.1 9.3 2014 79.7 5.7 2.4 9.5 3.9 13.4 3.1 6.9 3.2 3.8 11.8 32.9 42.6 57.4 75.7 96.4 119.3 143.4 0.2 0.6 0.7 0.3 0.2 0.3 0.1 0.1 0.2 0.3 0.1 0.1 0.3 0.9 1.0 0.4 0.2 0.4 0.1 0.2 0.2 0.4 0.2 0.2 0.4 1.4 1.7 0.6 0.4 0.7 0.2 0.2 0.3 0.6 0.3 0.3 0.6 2.0 2.3 0.9 0.6 0.9 0.3 0.3 0.5 0.8 0.4 0.5 3.3 4.5 7.1 10.2 14.2 36.2 47.1 64.6 85.9 110.6 Source: Market Insights Cloud Phase 2 opportunity assessment, Feb 7, 2011 2015 2010-2015 CAGR 90.7 20.4% 6.7 23.8% 2.8 29.3% 11.3 29.8% 4.6 28.6% 16.0 26.1% 3.8 31.7% 8.3 31.5% 3.8 30.1% 4.5 28.3% 14.4 31.0% 166.8 23.8% 1.5 5.7 4.5 2.2 1.8 2.4 0.7 0.9 1.3 2.0 1.0 1.2 1.9 7.6 5.3 2.7 2.3 3.2 1.0 1.1 1.7 2.5 1.2 1.5 33.7% 41.2% 25.8% 33.8% 41.3% 37.5% 35.7% 37.4% 39.5% 32.8% 37.5% 33.9% 19.1 25.1 32.0 35.0% 138.4 168.5 198.8 25.2% 0.9 1.2 2.9 4.1 3.0 3.8 1.3 1.7 0.9 1.3 1.3 1.8 0.4 0.5 0.5 0.6 0.7 1.0 1.2 1.5 0.5 0.7 © 2010 IBM Corporation 0.7 0.9 IBM Cloud Centers – Global Breadth and Depth Technical & Sales Training • • • 338 technical architects in 22 countries to be trained by June 30 124 BDE,PE, DPE in 22 countries to be trained by June 30 248 SEI Private Cloud Integrated sales team members in 21 IMT/GMTs to be trained by 3/31 Dedicated Resources Delivery Capabilities 123 Tiger sellers in 21 IMT/GMTs across GTS, Tivoli and STG 7 data centers delivering “IBM Cloud” services 38 SEI Private Cloud Integrated Teams in 21 IMT/GMTs 9 global security operations centers delivering Managed Security Services from the IBM Cloud • 11 IBM Cloud Labs 55 global BCRS sites delivering Information Protection Services • Global Sales Acceleration Center • • © 2010 IBM Corporation Top Challenges in Moving to a Public or Private Cloud Barriers to Cloud Adoption Security concerns are the most important fear among IT decision-makers for both public and private cloud, especially public cloud. Other factors, such as - lack of technology maturity - lack of personnel skill sets - organizational challenges and - difficulty integrating with existing infrastructure will likely decrease over © 2010 IBM Corporation time as cloud success stories circulate. Percent of Respondents Source: “Cloud Computing Attitudes”, IDC, April, 2010 Security is among the top concerns with cloud computing... The IBM Security Framework is a key differentiator in the Application and process marketplace People and identity Help keep applications secure, protected from malicious or fraudulent use, and hardened against failure Mitigate the risks associated with user access to corporate resources Network, server and end point Data and information Optimize service availability by mitigating risks to network components Understand, deploy and properly test controls for access to and usage of sensitive data IBM Security Professional Framework services Describes the business landscape of security Physical infrastructure Provide actionable intelligence on the desired state of physical infrastructure security and make improvements IBM Cloud Security Guidance Managed services Describes the technology landscape IBM Capabilities and Offerings to Help © 2010 IBM Corporation Hardware and software Catalogs of products, services and solutions Moving your IT to the cloud can drive significant benefits. 1 Capabilities From To Server and storage utilization 10-20 percent 70-90 percent Self service None Test provisioning Weeks Minutes Change management Months Days or hours Release management Weeks Minutes Metering or billing Fixed cost model Granular Standardization Complex Self service Payback period for new services Years Cloud accelerates business value across a wide variety of domains. © 2010 IBM Corporation Based on results from IBM’s Technology Adoption Program. Client-specific results can only be ascertained after a return on investment analysis. Unlimited Months Continued Cloud momentum with customers Continued Cloud Momentum with Our Customers Private Cloud Note: NATO & Panasonic are approved for external use Managed Services Software as a Service © 2010 IBM Corporation Meeting Storyboard What do I actually sell? © 2010 IBM Corporation Identifying Client Pain Points Cloud computing = selling opportunities to address client needs Key Pain Points • Lost business opportunity - IT lacks agility • Long deployment timelines (weeks/months+) • Change process complex (people, cost, time) & prone to error • Upfront investment for new infrastructure too high • Server sprawl with low utilization • Costly Compliance, auditing, and security patching • Don’t know what compute resources are used or how much they cost © 2010 IBM Corporation • Limited funding of new IT priorities because budget consumed maintaining existing IT infrastructure Probing Questions to assess Client Cloud Needs • Response time – How quickly can you react to deliver new IT service? • Steps to provide IT resources - How many steps are in the provisioning/ de-provisioning process? • Support resources - What is the ratio of system admin staff to servers or users? • Outages - Have you experienced outages due to human error? • Scalable IT - How are systems sized and scaled quickly (peak usage, CUOD)? • Allocation of IT resources - How many images per user? Is IT sized for min, mean, or peak? • IT configurations - How many different configurations used? •How do you manage backups? • Measurement system - Level of metering & charging method used? How is software license compliance managed? • Allocation of budget - Does your budget allow for innovation supporting new business initiatives? • Is your budget eaten up on capital IT expense? © 2010 IBM Corporation Through your client discussion, identify the entry point that you think is the most likely Item Entry Point Description Area of Focus? 1 Cloud Strategy and Design Help is needed to develop a Cloud business, technology and operating strategy and understand how to capitalize on the potential business benefits (flexibility, cost savings, etc.). Y/N? Priority level? Comments? 2 Cloud-Enabled Data Center Help is needed to set up, migrate and/or optimize the technology infrastructure to enable a Cloud implementation and to maximize the value of Cloud. Y/N? Priority level? Comments? 3 Cloud Application Workload Services Help is needed to develop, set up, deploy and/or Y/N? consume applications as workloads on the Cloud. Priority level? Comments? © 2010 IBM Corporation Discuss Virtualization with the client and assess where they are on the path to virtualization The conversation could include these points: You ask a lot of your IT systems. And the reality is, to make your business more agile you ask even more. If your IT staff spends all of their time worrying about security, uptime and capacity problems, they won’t be working with you to drive innovation. You need your infrastructure to help you in the marketplace, to help you innovate, to help you be more competitive, to help you succeed. Today, success demands agility. You need to adjust to changes in your business, from your customers, and in the world. IBM offers virtualization solutions with Integrated Service Management designed to help your business be more agile. With these solutions, you can: Consolidate resources with a choice of virtualization technologies to improve efficiency and reduce ongoing costs – do more with less Manage workloads simply to make it easier for your IT staff to support the key business priorities Automate processes to reduce management costs and make execution of key tasks more consistent toCorporation the demands of the Optimize delivery of services so that applications can quickly respond © 2010 IBM business. Through your discussion, assess the client’s virtualization maturity level Maturity Activity Level Description Area of Focus? 1 Consolidate Resources With virtualization, you can reduce the number of servers, Y/N? storage, desktop, and network devices to reduce complexity Priority level? and make IT management simpler. You can also reduce Comments? electricity used to power and cool these systems and save on floor space in your data center. 2 Manage Workloads Consolidation with virtualization can reduce complexity by Y/N? reducing the number of physical devices. But, virtualization Priority level? creates a new set of management demands and more work Comments? for your IT staff. 3 Automate Processes With a virtualized infrastructure, you have the ability to assign resources to your highest priority business needs. With automated processes based on best practices and business rules, you can reduce manual errors as your IT systems automatically respond to changing business conditions. Y/N? Priority level? Comments? 4 Optimize Delivery You need to let users self-provision IT resources © 2010and IBM Corporation optimize delivery of IT services. This can help assure that resources are delivered in the most timely and efficient manner. Y/N? Priority level? Comments? By introducing the IBM Cloud Reference Architecture, you can discuss the client’s architecture readiness for cloud IBM Cloud Computing Reference Architecture Questions for the Client Have you adopted, or are you adopting, a Cloud Reference Architecture? Y/N? What does it look like? Please provide description (diagram, documentation, etc.) What are the current levels of development and deployment? Please describe Business Partners: Learn more about it HERE © 2010 IBM Corporation Prioritizing Workloads to Move to Cloud Computing You can use simple spreadsheets to prioritize workloads. Be sure to have someone who can fill in the spreadsheets as you discuss workloads. The discussion might look like this: 1. Describe the workloads Workload Categories Workload Analytics Collaboration Development / Test Desktop / Devices Compute Storage 2. Identify the workloads to move to cloud and the priority of moving them Priority to Move to Cloud Move? Y Y Y N Y Y Priority 1 2 3 0 2 1 0 = None 1 = Low 2 = Med, 3 = High 3. Select the cloud deployment model(s) that best fit each workload Deployment Traditional • Traditional • Private Private Mgd Private • Managed Private Host Priv • Hosted Private Shared • Shared Services Public • Public Services © 2010 IBM Corporation Over half of UK companies indicate high interest in adopting many workloads in either Public or Private clouds Comparison of Cloud Delivery Models for the United Kingdom (Current Use/Consideration) Public Private Hosted Private Business social networking tools Workloads 82% 64% 65% Web-facing applications 78% 71% 67% Team workspaces / workgroup 70% 82% 64% CRM 65% 75% 65% Email 62% 68% 65% HR learning/training 61% 70% 56% Back-up/recovery 59% 69% 68% Data analysis/data mining/analytics 58% 60% 52% SCM 57% 67% 67% Telephony services 57% 66% 61% Storage 56% 68% 68% Archive 55% 66% 68% Data warehousing/data mart 53% 72% 72% Business transaction lifecycle processes 52% 80% 74% Disaster recovery 51% 62% 68% Server 48% 67% 61% Development environments 44% 77% 70% Expense reporting 44% 75% 66% Systems management 42% 56% 50% Desktop 41% 58% 48% ERP 41% 67% OLTP 37% 66% 48% Security 28% 58% 47% Application Lifecycle Management * * * Design automation/HPC * * * Source: Market Assessment Panel, Uncovering Cloud Computing Opportunities, 2010 Base: depending on the workload, UK=30-82; *Sample sizes of less than 30 18 January 2011 © 2010 IBM 68% Corporation For each workload, identify the main drivers and challenges to moving the workload to cloud computing Drivers Challenges Decrease capital expenditures Cost prohibitive/price Decrease operational expenditures IT organization is not structured to change processes and policies Lower Total Cost of Ownership Aids in disaster recovery Speed time to deployment Improved availability Improved security Improve utilization of IT resources Improve response to changes in workload demand (flexibility) Simplified management Difficult to integrate with already installed technology Doubt the savings/projected ROI numbers Technology is immature at this time Ability to meet SLAs Lack of staff skill sets Issues with downtime/availability Security concerns © 2010 IBM Corporation Vendor lock-in Source: IDC, Cloud Computing Attitudes, April 2010 There is a spectrum of Cloud Computing deployment models Private Cloud Services, behind a firewall Delivery Model 1 Cloud scope Delivery Model 2 Enterprise Data Center Enterprise Data Center Private Cloud Managed Private Cloud Service Provider Operated Delivery Model 3 Enterprise Hosted Private Cloud - Dedicated Service ServiceProvider Provider Operated Operated Standardized Services Delivery Model 5 Delivery Model 4 Ent A Ent B User User User A B C User User D E Ent C Hosted Private Cloud - Shared Service ServiceProvider Provider Operated Operated Cloud Public Services Operator Enterprise Ownership Enterprise Enterprise Service Provider Location Enterprise Svc Provider Revenue model Time & materials, fixed price, etc. Access Internal enterprise network Access through VPN, public internet Public internet Consumer Single enterprise Multiple enterprises Any enterprise/ user Asset use Dedicated (single tenant) Service Provider Agreed-to Mgmt Fee Mixed Time & materials, fixed price, pay-as-you-go Dedicated Enterprise (Private) Service Provider (“Public”) Service Provider Pay-as-you-go © 2010 Multi-tenant IBM Corporation Source: Market Insights Cloud Phase 2 opportunity assessment, Sept 11, 2010, in consultation with International Planning & Research Multi-tenant IBM’s channel plays cover all of the major Cloud markets and models Enterprise Data Center Enterprise Data Center Private Cloud Managed Private Cloud Existing channel plays in bold Hosted Private Cloud - Dedicated Service ServiceProvider Provider Operated Operated Service Provider Operated IBM Cloud Maintenance Services (XaaS) - $139B* Ent C GTS Cloud Services IBM Industry Cloud Services Info Mgt ISDM Cloudburst Systems SW Cumulus Custom Cloud IBM Cloud Hosting Provider Kit Attach IBM Cloud Services to Private Cloud Technology deals © 2010 IBM Corporation Sell with ISV’s Lotus Live & Other SWG Cloud Services ISV SaaS Services Communi cations Service Provider Platform Cloud Services Provider ($24B) (Cloud Technologies) - $60B* Enterprise Private ($36B) Arms Supply Cloud Public Services SmartCloud - Enterprise IBM Cloud services Sell thru BP’s Sell to BP’s User User User A B C User User D E Public Services ($104B) Cloud Services BP resale of IBM Cloud Services – Hosting Provider Model Ent B Hosted Private Cloud - Shared Service ServiceProvider Provider Operated Operated Hosted Private ($16B) TivoliLive IPS Managed Security Managed Private ($19B) New Channels Play to be developed Ent A Enterprise * 2015 WW Cloud Market Size: Source – IBM Market Insights Cloud Phase 2 opportunity assessment, Feb 7, 2011 Select “Create a new workshop” and click the “OK” button © 2010 IBM Corporation How is the BVA tool used? A proven process to support customers with a ROI analysis ROI Analysis Process Position • Understand strategic goals • Identify ROI sponsor • Discuss ROI approach and methodology Interview Generate • Input data into • Complete ROI tool questionnaire • Estimate project • Understand business drivers implementation costs, and technical timescales and environment resources • Conduct internal review Validate • Review analysis with sponsor • Revise input and assumptions • Rerun analysis • Generate new report Present • Present ROI to management board • Review business benefits • Discuss next steps and acceptance criterias © 2010 IBM Corporation REVISE INPUTS Meeting Storyboard What type of BP would you like to be? © 2010 IBM Corporation IBM/Partner Cloud Computing Strategic Plan - 2011 Markets selected? What will we sell them? How will we make money? Large Private Cloud Solutions? Average transaction size Medium Public Cloud Services Gross/Net Profit Margins Small Other? Follow on opportunity Industries Who are the target Clients? To be determined Non-cloud related follow on How many leads do we need? To be determined What % can we close? To be determined Goals – what will we achieve in our cloud business this year? # of Cloud deals (types, size) Revenue goals, trained sellers and practitioners How can we start our Cloud business? tbd What resources will be required? Partner IBM © 2010 IBM Corporation IBM/Partner Cloud Strategy: IBM and Partner will launch our Cloud business in the (local) market by… Cloud computing presents new business opportunities for existing and emerging Business Partners Private Cloud Implementation Opportunity: $23B growing to $67B Infrastructure & Platform Services Opportunity: $16B growing to $55B Business Solutions Opportunity: $22B growing to $67B “I want to help my clients to design, build, manage their private cloud” “I want to build and operate a public cloud infrastructure (IaaS and PaaS)” “I want to deliver my application or asset as a cloud service” “I want to resell a portfolio of public cloud services” © 2010 IBM Corporation “I want to extend and add value to other providers’ clouds” 26 Thank You! ibm.com/cloud/partner © 2010 IBM Corporation © 2011 IBM, the IBM logo, ibm.com, Smarter Planet, the Smarter Planet icon, Cognos and LotusLive are trademarks of IBM Corp. registered in many jurisdictions worldwide. 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