Why private cloud will make IT think like Wal-Mart

Public. Private. Hybrid. Cloudburst. Much of the discussion about cloud computing focuses on deployment options and choices, with a surprisingly large number of enterprises inclining toward internal private clouds-that is, a cloud-capable infrastructure residing within a company's own data center.

A just-published survey by Evans Data supports this trend, indicating that 30 percent of developers (sample = 500) are currently working on projects that will run in private clouds (Important: the article notes that this is probably skewed, as the survey participants are self-selected). This seems quite high to me, given that the number of actual private clouds is pretty darn small. However, one can design and build an app in a public cloud environment with the ultimate goal of hosting the app in a private cloud. In any case, the survey reinforces an anecdotal sense that enterprises are very attracted to the concept of building and operating their own cloud.

It's easy to understand the attraction of a private cloud: it bypasses issues of security and uncertainty associated (fairly or not) with public cloud providers like Amazon, while offering tangible cloud benefits like agile deployment and easy scalability. In a sense, a private cloud offers the best of both worlds: safety and innovation. I did a series of posts on private clouds a few months ago that discussed the topic at length. In this post, I want to focus on one very important topic regarding private clouds: the supply chain.

If you look at the chart that accompanied my private cloud postings, you'll note a dark black dotted line that demarcates application groups (cloud consumers) and IT operations (cloud providers). It illustrates and symbolizes the fact that the working relationships between these two groups will change with the advent of private clouds.

Today, the process of provisioning internal compute resources is an extended, manual process punctuated with meetings, emails, telephone calls, etc. Application groups discuss (i.e., signal) their resource requirements well ahead of need for the resources, allowing plenty of time for operations to (if necessary) order equipment, install and configure server resources, connect and configure storage, and finally make the compute resources available to the application group. In many companies, IT operations has no independent budget for capital equipment; rather, hardware procurement is tied to application demand. A new application needs hardware, the cost is placed in the app's project budget, and money is transferred to the infrastructure group (after, of course, many emails, phone calls, etc.) for actual purchase and emplacement.

You probably noticed that the current process-manual and extended timelines-does not align very well with the cloud vision of resource provisioning as automated and near-real time. In fact, one could say that the clamor for private clouds is rooted in frustration with current provisioning timeframes that can extend to weeks, if not months.

What does this have to do with supply chains?

Most everyone is familiar with the concept of a supply chain-an interlinked vector of individual participants who cooperate to satisfy end user demand. In retail, for example, Wal-Mart capitalized on its supply chain efficiencies of coordinating product sourcing, transportation logistics, and sales data feedback to fuel its leap to biggest retailer in the world. Many of us in the tech industry are familiar with the analogous chain that ties together ODM (Original Devices Manufacturers like HTC), transport firms, product designer (e.g., HP), and retail outlets-all coordinated to deliver a, say, server to an IT operations group so that it can install it in response to demand from an applications group.

But I'd like to posit that in cloud computing, particularly the private variant, another supply chain exists, one based on virtual resources within the data center. In this supply chain, demand emanates from a member of an applications group who (in the vision of cloud computing) fills out a web form that identifies type and amount of resources, (e.g., two virtual processors, so much memory, network connectivity, storage, and so on) clicks the submit button, and, voila, compute resources appear, ready to use, in a matter of minutes. It is the job of IT Operations to emulate Wal-Mart and coordinate sourcing, logistics, and shelf (or in this case, rack) stacking to ensure sufficient resources are available to meet application group demand.

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