CIOs tap cloud for growth and change

Delegates to the Asia Cloud Forum Conference held in Melbourne earlier this year heard keynote case studies from leading Australian companies Pacific Brands, Realestate.com and major bank ANZ. Each company’s CIO outlined how the cloud was contributing to growth.

Pacific Brands, for example, found the cloud useful as it integrated new operations after a series of mergers and acquisitions (M&A) events. Realestate.com was able to continue its remarkable expansion as it moved to a new version of its service, while ANZ outlined how the role the cloud was playing into the bank’s strategy to be a major player not just in Australia, but also in Asian financial services.

The messages in those keynotes were reinforced when CIOs from leading organizations Australia Post and transport company Ventura revealed how they were using the cloud.

With the decline in physical mail, Australia Post is focussing on logistics and payments while Ventura has developed, through the cloud, scheduling and ticketing expertise it is now able to provide as a commercial service to others.

Brent England, the technical services lead at clothing manufacturer Pacific Brands, outlined his company’s journey to the cloud. To give an idea of scale, Pacific Brands has over 3,600 employees, produces 300,000 different products and over 200 million units each year, and generated revenues of A$1.68 billion in 2011.

Accelerating change

Strong business growth helped along by M&As was driving technology infrastructure growth. By 2007, the company had 70 servers in the datacenter and another 70 in remote site offices, and there was pressure to manage an ever growing number of applications. There was a lack of agility – infrastructure development took up to six weeks and there were high operating costs.

“Businesses want to move more quickly, and technology was keeping us from doing so,” said England. “We needed a better way to serve the business.”

The solution was virtualization, initially with VMware, and the company then switched to Microsoft Windows Server and System Center. This move overcame performance issues and increased consolidation ratios -- there were now 200 VMs on 10 hosts compared with the previous situation of 140 VMs on 27 hosts.

In this virtual environment, Pacific Brands runs the major business applications such as Active Directory, Exchange, SQL, Dynamics, Sharepoint, JDEdwards & Linux.

“We use the System Centre dashboard as a ‘single pane of glass’ into the application environment,” said England.

The benefits have been tangible. The lead time to deploy applications came down from six weeks to only one. There was a 24% reduction in the hardware footprint and a 160% increase in the applications environment, while the transition achieved the reliability needed to support the expanded business.

“Through our use of Microsoft Virtualization and System Center technology, we’ve taken our IT infrastructure from a constrained environment to a strategic asset that helps propel Pacific Brands forward,” England said.

At Realestate.com, Australia’s leading online property listing and search website, the mix of public and private cloud has been the key to the company’s growth and agility. From its beginnings in a Melbourne garage in 1995 the REA Group – which operates Realestate.com – has grown into a multinational company with a presence in Europe and a total staff of around 600.

The company’s cloud strategy was evolving, Damian Fasciani said, as it leveraged multiple platforms across IaaS, PaaS and SaaS. REA Group was using a hybrid cloud combination of Amazon webservices, VMWare, Windows Azure and Engine Yard in the IaaS and PaaS spaces, and zendesk, salesforce.com and Netsuite in SaaS.

One of the main drivers was to deliver the consumerization of IT, where staff were able to self-serve and use whichever software and devices they preferred. The goal was to create a REA “app store”, built on the idea of Apple’s iTunes, where people could access this self-serve model.

Beware cloud lock-in
In arriving at its solutions, Fasciani said REA had come to several conclusions. These were to avoid vendor lock-in and select the right solution based on the business need. Also understand that IaaS, PaaS and SaaS all offer different value propositions, and that a cloud strategy can be a mash up of all of these.

Risk was another significant factor to be considered, and rigorous due diligence needed to be conducted on issues such as data privacy, jurisdiction and industry certifications.

From ANZ Banking Group, CTO Patrick Maes spoke about how the cloud was assisting in building a regional bank with connectivity across Asia Pacific.

The bank was at the forefront of negotiating major cloud issues such as the US Patriot Act, the Australian Taxation Offices Wickenby fraud and money laundering taskforce, and general issues of data integrity, private and crossborder security.

Maes said the bank had identified four key issues to resolve -- service levels and continuity of service, exclusion of liability and warrants, termination of contracts (What happens to the data?), and audit and inspection rights.

The bank’s approach was to create a division between the cloud and the bank. Although everything was in the cloud, including the user interface mashup, the identifying customer data remained with the bank, as did the encryption keys. “Significant data is not to be mastered in the cloud, with specific restrictions on customer and transactional data,” Maes said.

Cloud solutions should not be “siloed,” he said. The solutions must be integrated “back to the base” which was the bank itself. The bank needed a range of services, from multi-tenant to trusted multi-tenant to single tenant, but there needed to be full disclosure and full transparency of architecture as there would be with any outsourcing provider.

Agreements need to be tailored rather than “one size fits all,” Maes said, and the agreements needed to satisfy information management, information security and various regulatory requirements.