Home / Technology Policy & Ethics / September 2020 / Cloud technologies: All-Cloud IT Operating Model

Cloud technologies: All-Cloud IT Operating Model

Dr. Petar Radanliev and Prof. Dave De Roure, Department of Engineering Sciences, University of Oxford

September 2020

Why are the IT operational strategies transforming from data centers ownership into an all-cloud subscription?

The traditional IT operating models are slowly becoming obsolete in the new digital age. New ‘all-cloud operations’ emerge from the digital transformation and require a new mind-set. In the all-cloud operations, developers and business executives translate the products, services, constraints, and security controls into cloud architectures and data models. As this transformation from capital intensive IT operations is evolving into low-asset, all-cloud digital IT operations, the role of IT operations is also manager is evolving. This will inevitably cause some discomfort, but for those that can embrace these changes, the career opportunities will amplify.

What is All-Cloud IT Operating Model?

New technologies enable the simplification and wider availability of products. This means new highly tailored products that are easier to sell, buy and to trust. Digital cloud computing platforms, such as the Amazon Web Services enable simple, engaging, and customized digital experiences. These platforms provide new opportunities for established providers. But digital platforms come with the inherited cyber risk in addition to the lower acceptance rate and distrust. These factors could create a negative impact on established services and products. For example, a breach in the digital platform could expose the client’s personal data and create a significant negative impact on established insurers’ brand reputation.

However, comparing this risk, with the risk from a cyber-breach of a company owns IT data centers on the company’s own brand reputation; the cloud IT operating system still presents certain advantages. For example, companies could argue that the breach was caused by a system vulnerability of the cloud platform provider, not the company. This is effectively a risk mitigation strategy for one of the greatest assets, the brand reputation. To mitigate this risk further, established companies are creating new start-up units, specialized in providing innovative digital solutions directly to consumers. Such start-up units require a new set of skills in digital coordination, infrastructure, and competencies that are key to driving forward these new types of products.

There are a few key areas that companies need to have in place before they engage in providing digital products. Apart from these key areas, the current focus is also placed on the seamless incorporation of global and local item correlations that ease data sparsity problems [1]. There is also an increased focus on multi-people tracking and re-identification with account for objects’ ‘appearance changes and longer-term associations’ [2], especially with the emergence of the COVID-19 outbreak. Challenges also emerge in real-life deployment algorithm that simultaneously tracks the location of multiple residents in smart homes [3] and cities, especially since COVID-19.

Cloud IT Operations strategy

The first key element is to develop and define a cloud IT operations strategy. The future of cloud IT operational strategies is in shared on-demand services. With the current rate of growth, the IT as a service is estimated to represent more than half of all IT spending. The evolution of IT operations from ownership to subscription is likely to cause a great deal of concerns, especially among IT admin and operations managers with lifetime experiences in managing small data centers. Regardless of that, the transformation into all-cloud (buy nothing) IT operational strategies is happening at a very fast pace. Two-thirds of new IT facilities in 2017 have moved to warehouse-scale clouds.

Financial implication

The shift from data centers ownership to cloud platform subscription also creates a financial change the IT operating model. Firstly, there is a shift from capital expenditure to operational expenditure. Secondly, with much of the IT infrastructure becoming obsolete, many of the IT functions (e.g. racking servers, connecting switches) are replaced with rented services. Data center management is expensive and requires specialized experts to ensure operations. To reach a similar operational level of a hyper-scale cloud facility, a data center would cost many millions.

Operational mobility

One of the greatest advantages of an IT operations strategy built upon on-demand cloud computing platforms is the flexibility to expand operations and add new technologies as and when required by the increase in market demand [4]. This eliminates the requirements for retrofitting legacy systems to reduce the cost of installing new fast-changing technologies. Retrofitting of legacy systems is one of the key cyber-risk factors. It is becoming very hard to justify significant investments in IT infrastructure and specialized personal, while a comprehensive cloud services, with state-of-the-art infrastructure, can be rented for a much lower cost. The cost justification is even weaker for start-up businesses without established markets. Start-ups are high-risk, high-reward operations. With on-demand cloud computing platforms, if the start-up does not prove profitable, there is no significant capital loss from withdrawing operations. In other words, the risk of failure and the financial cost of failure is much easier to accept, because there is no significant initial capital investment. In the digital era where privacy-preserving approaches are considered the new normal in data publishing with identity reservation [5], on-demand cloud computing platforms provide almost instant compliance with constantly increasing privacy regulations.

Cost of cloud platforms

The nature of cloud services, the availability of solutions, the option for execution of cloud migrations, scaling resources, deploying patches and updates and completing related tasks, makes it very easy for operations engineers to spend a lot of money without even knowing. A new role for IT operations manager is emerging, that is the cloud capacity management. This involves guiding the cloud strategy of the business, choosing cloud consumption strategies and setting allocations. In other words, managing the start-ups unwanted and unknowing misuse of resources. The cloud capacity manager role requires experience with platform as a service in addition to infrastructure as a service. Such experience would enable the process of identifying services tailored to the needs of the given application. This would ensure the necessary capacity and reduce unnecessary spending. This does not necessarily mean managing operations of applications in terms of usage or storage. It is more about the allocation of what is required for operations on one, or on multiple cloud providers to ensure the deployment. Cloud providers provide tools for setting up roles in the cloud platform for the cloud capacity manager to control the usage. Some of the useful tools are the monthly spending and security settings and the employee access to resources. But there and many other useful tools for service delivery decisions.

Final remarks on the new role of IT operations

The all-cloud operations strategies necessitate a digital transformation that requires a different business mindset. The new mindset should be focused on mapping products and services goals to different digital technologies and communicating this to different levels of the organization. The digital strategy communication needs to involve the application developers and business executives from early implementation. The new value from IT operations is in the ability to translate the product and service requirements, the development constraints, and security controls into cloud architectures and data models that would be easy to understand by team members. As this transformation from capital intensive IT operations is evolving into low-asset, all-cloud digital IT operations, the role of IT operations manager is evolving. This will inevitably cause some discomfort for established IT employees. Even so, for those that can embrace these changes, the career opportunities will amplify, but so will the new professional challenges.

References 

  1. Liu, Huiting., Liu, Huimin., Ji, Qiang., Zhao, Peng., and Wu, Xindong, “Collaborative deep recommendation with global and local item correlations,” Neurocomputing, vol. 385, pp. 278–291, Apr. 2020.
  2. Lan, Long., Wang, Xinchao., Hua, Gang., Huang, Thomas S., and Tao, Dacheng, “Semi-online Multi-people Tracking by Re-identification,” Int. J. Comput. Vis., pp. 1–19, Mar. 2020.
  3. Wang, Tinghui., and Cook, Diane J., “sMRT: Multi-Resident Tracking in Smart Homes with Sensor Vectorization,” IEEE Trans. Pattern Anal. Mach. Intell., pp. 1–1, Feb. 2020.
  4. Sunyaev, Ali, “Cloud Computing,” in Internet Computing, Cham: Springer International Publishing, 2020, pp. 195–236.
  5. Wang, Jinyan., Du, Kai., Luo, Xudong., and Li, Xianxian, “Two privacy-preserving approaches for data publishing with identity reservation,” Knowl. Inf. Syst., vol. 60, no. 2, pp. 1039–1080, Aug. 2019.

Petar Radanliev is a Post-Doctoral Research Associate at the University of Oxford. He obtained his Ph.D at University of Wales in 2014 and continued with postdoctoral research at Imperial College London, Massachusetts Institute of Technology, and the University of Oxford. His current research focusses on artificial intelligence, internet of things, cyber risk analytics, and the impact of cyber risk.

 

David De Roure is a Professor of e-Research at the University of Oxford. He obtained his PhD at the University of Southampton in 1990 and went on to hold the post of Professor of Computer Science, later directing the UK Digital Social Research programme. His current research focusses on social machines, Internet of Things, and cybersecurity. He is a Fellow of the British Computer Society and the Institute of Mathematics and its Applications.

Editor: 

Onur Alparslan received B.S. and M.S. degrees from Bilkent University, Ankara, Turkey, in 2002 and 2005, in electrical and electronics engineering. I received Ph.D. degree from Osaka University, Japan, in information science and technology, in 2008. I was the recipient of the Monbukagakusho Graduate Scholarship from the Ministry of Education, Science, Sports and Culture of Japan between 2005–2008. I worked as a post-doctoral researcher at Osaka University from 2008 to 2016. Now I am a visiting researcher at Osaka University since 2016. My research interests are optical networks, traffic engineering, network function virtualization (NFV), and simulation. I was the recipient of the “Best Paper Award” at the First International Conference on Evolving Internet (INTERNET 2009). I have published over 20 papers in international journals and conferences, many of which are in IEEE journals and conferences. I have worked on many government-funded projects on computer networks and telecommunications in Europe and Japan. I became a student member of IEEE in 2002 when I was a B.S. student. Currently, I am a member of IEEE in Kansai Section of IEEE Region R10.