OC CIO Roundtable Minutes 6-11-09

1993-2009
Southern California/Orange County CIO Breakfast Round Table
June 11, 2009 meeting

Present: Sean Brown, Greg Gillis, Jim Sutter, Sharon Solomon, Jeff Reid, Jeff Hecht, Jennifer Curlee, David Mann, Andy King, William Zauner, Carmella Cassetta, Dave Phillips

We welcomed Greg Gillis, SAP, to the meeting to assist with the presentation.

The minutes of this and prior breakfasts are available online at the Peer Consulting Group’s website, www.peergroup.net, with links to the presentation material, when available.

Topic: Cloud computing update.

This is a popular topic and is the lead article in the June 1, 2009 CIO Magazine – Cloud Control. Sean Brown, RJTCompuquest, started with an informative video, http:/www.youtube.com/watch?v=XdBd14rjcs0. Cloud computing is a dynamically scalable computing resource, where virtualized resources are provided as a service over the Internet. It incorporates infrastructure (IaaS), platform (PaaS) and software (SaaS) as a service. IDC forecasts the Cloud computing market to grow to $42B by 2012, from $16B in 2008, and will consume 25% of the total IT budget. It’s becoming popular as a pay-as-you-go option because of increased bandwidth, faster and cheaper hardware, virtualization and web services protocols. Users can avoid capital expenditures, and consumers are billed for what they use as a utility (like electricity), or subscription (like a paper). There are little or no upfront or termination costs, and services are provided with service level agreements. Despite differences of opinion on what Nicholas Carr has to say, there are names worth watching in this space. Founded in 1994, Amazon is one of the innovators in Web-based computing, offering pay-as-you-go access to virtual servers and data storage space (see Sean’s handout for more detail). Prominent customers include NY Times and Eli Lilly. Another major force is Salesforce.com, founded in 1999, with its set of CRM tools and a platform for building web applications. Google is a big player offering Google Apps, and a simple Web site creation tool, Postini. While the company’s main focus is search, no one knows the Internet quite like Google. And never underestimate Microsoft. The Pros of the Cloud include fast start-up, scalability, business agility, faster product development, and no capital expenditures. The Cons include bandwidth can become expensive, application performance could suffer, data integrity, you could be too big to scale, and human capital may be lacking. To mitigate this, you can demand SAS 70 compliance. Gartner lists several issues which potential users of Cloud computing should be aware of, including the location of the data storage units, data segregation and availability, disaster recovery, long-term viability of the vendor and how to recover your data if the vendor becomes unable to respond. Sean's presentation is at http://www.slideshare.net/occio .

Jim Sutter, Peer Consulting Group, said that he has limited experience with Cloud computing, although he is on the Board of a small vendor that offers a development environment on Amazon. Lots of Silicon Valley start-ups use the Cloud approach. He agrees that there are issues including integrating with other IT services used, and management problems, especially for small company CIOs when trying to solve service problems. One of his clients is looking at this especially since they have found a predictive maintenance SaaS provider to enhance their J D Edwards systems.

Sharon Solomon enjoyed the presentation. It makes you think about what do you need in your environment, and how best to supply those services – part Cloud and part in-house. She worked in a heavily regulated environment where they had to be very careful with protecting against unauthorized access to data, but they did use Salesforce.com

Jeff Reid also does not have much experience with SaaS, and he has lots of questions, similar to those you have when considering outsourcing. How open are these vendors to audit? Last month, he introduced the topic of Virtualization but talked about it in terms of in-house use of virtual resources. Cloud computing adds another wrinkle to that discussion, and it depends where you are in your business cycle.

Jeff Hecht, Word & Brown, said that it depends on where you are in your business cycle and on where you are with each of your applications. They are looking hard at outsourcing Exchange to a Cloud vendor. He likes the availability (24X7X52), DR, etc. Integration is an issue. You still need expertise to run the Cloud computing and to manage the network.

Jennifer Curlee, Surefire, said that they outsource their storefront, which is transaction based. They are starting to use SaaS where they don’t have in-house expertise, like using Avatax (?) for Tax. They are finding problems with the interface between it and SAP, and are having performance problems. They have had to segregate the services.

David Mann, Word & Brown, complimented Sean on his presentation. They are seriously evaluating the ROI of Cloud computing, and last year looked at Salesforce.com. The balance is between time-to-market vs. integration. They have decided to go with Microsoft CRM, as it gave them more options than Salesforce.com.

Andy King, Exemplis Corporation, added his compliments on the presentation, and reflected on how company culture affects these decisions. It is not their style to use Cloud computing, but they will crawl, walk then run with it. They might go with Salesforce.com, but don’t like subscription services – they prefer capital expenses to operating expenses.

Carmella Cassetta, Corinthian Colleges, also thought it was a good presentation. They use SaaS for Emergency Call-in, and are seriously looking at Cloud computing for things they are trying to test. It depends on the data, the application, whether it is informative, not transactional in nature.

Thanks again to Sean and Greg for the very good introduction and informative handout.

See you on July 9, 2009 – 7:00 a.m. in the RJTCompuquest conference room at:
940 South Coast Dr., Suite 260, Costa Mesa, CA 92626.

OC CIO Roundtable Minutes 5-14-09

1993-2009
Southern California/Orange County CIO Breakfast Round Table
May 14, 2009 meeting

Present: Jeff Reid, Steve Kronebusch, Andy King, Jim Sutter, Jennifer Curlee, Jeff Hecht, Sharon Solomon, Dave Phillips

We welcomed Steve Kronebusch, Sidepath – Simplifying Networks, to the meeting as a subject matter expert to provide technical backup where needed.

The minutes of this and prior breakfasts are available online at the Peer Consulting Group’s website, www.peergroup.net, with links to the presentation material, when available.

Topic: Virtualization – server, storage, desktop, application, network.

Jeff Reid said that preparing this introduction proved to be very enlightening. He had some experience with virtualization at Conexant using VMWare, and more at Thornton Holdings where they ran into problems with compatibility between the virtualization software and their Great Plains, Citrix and Microsoft software. The official response from the vendors was “we can’t support you”, but unofficially they would put them in touch with many of their users who were running VM. Before virtualization, a given application ran on a specific hardware and OS software platform. Virtualization decouples the components, allowing sharing of resources, increased utilization (decreases future costs), lessens management overhead (still necessary, and capacity planning is important), reduces power consumption, and reduces response time for creating new virtual servers (to 30 min. or so). The areas of virtualization include servers, storage, desktop, applications and networks. The VM software turns hardware into software instances, which the Hypervisor maps to the physical server, router, switch or storage. The Connection Broker software allows a user to connect to his/her own virtual desktop of data and services, like the thin client concept. There are several virtualization packages – VMWare (market leader), Microsoft Hyper V (relatively new), Citrix Xen (building on their thin client experience), Virtual Iron (Oracle just bought them). This presentation is focused on VMWare and Compellent. VMWare breaks the dependency between OS and the hardware, allowing a large number of virtual machines to share a single pool of server resources, increasing utilization thus decreasing costs. Compellent breaks the dependency between servers and storage, by virtualizing all disks into one pool of storage, accessible by any server, reducing cost and wasted of storage capacity. This combination dynamically balances computing and storage resources based on business needs and predefined rules. It allows you to setup, test and implement DR with no downtime and less cost and complexity. It enables cost effective high availability for applications (and data protection and recovery) on virtual machines by combining snapshots of files and automatic restart of virtual machines in case of server failure. You can run multiple desk top OS (Mac, XP or Vista OS) on the same machine. Cisco has allowed workers to choose from a handful of laptops – about 25% choose Macs. Jeff’s handout covers this in more detail along with general thoughts and advice. A virtual management tool is required (VMWare’s is VCenter). Get your staff certified. Do an assessment. Review your current data backup and recovery processes. Power consumption will reduce but will increase in spots because of footprint density and you might need hot air removal. It is worth looking at and there are compelling reasons for implementing virtualization. His slides can ce found at: http://www.slideshare.net/occio.

Andy King, Exemplis Corporation, said that they use VMWare in a test environment. It gives application developers a playpen (pig pen!). They are relatively small in number (10 people), and so there is not a compelling reason to go virtualization. He complimented Jeff on his presentation, and now has more energy to plan for more.

Jim Sutter, Peer Consulting Group, also thanked Jeff for the thoroughness of his presentation, for which Jeff thanked Steve for his assistance. Jim does see a problem with taking this to the BoD – great IT story, but why didn’t we do this before. At one of his clients, they went to Vista with all new hardware, more laptops than desktops, never went to XP, and didn’t find a cost reason to go thin client. Looking back to his many years in the business, he remembers vividly the very large mainframe, and all its complexity. Now we are back to more of the same!

Jennifer Curlee, Surefire, said that they are relatively small (25 servers) and welcome virtualization to cut expenses. They went to a Xen server, deferred management tools, and will go gradually to virtualization. Her concerns revolve around performance and the network.

Jeff Hecht, Word & Brown, said that they have gone virtual for all their developers (50 in both locations). It provides high availability and many alternative environments. He is able to make the case for cost avoidance. They provide a virtual desktop environment for their offshore developers, as they don’t want proprietary software to go offshore. They use best of breed solutions, and they can start with a low risk, low cost entry point. It provides for more productivity, and for staged test environments. It is great for websites, especially low volume sites.

Sharon Solomon complimented Jeff for a great presentation. At Watson Pharmaceuticals, they had a 3-year plan to go virtual, and presented it to the CFO. Remember that this is a very regulated environment, and so backup, DR and rollout were very important.

Steve Kronebusch, Sidepath, thanked the group for inviting him to participate and he enjoyed the meeting. It is not often that he gets to hear the discussion from the CIO’s point of view.

Thanks again to Jeff and Steve for the very good introduction and informative handout.