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Smart Enterprise: Greater Expectations

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he world of IT is evolving once again. CIOs, who were the builders, managers and providers of in-house technology, are today becoming managers of a new IT supply chain. Included in these supply chains are both internal IT resources and external cloud services that can be sliced, diced and combined dynamically into efficient, cost-effective business services. But as CIOs increasingly rely on third-party IT providers in the cloud, they're also encountering new levels of complexity. Because providers in the cloud in turn rely on their own supply chain of cloud and communications partners, monitoring per- formance and fixing problems can involve new levels of detail. Consider, for example, a provider of software as a service (SaaS) that counts global enterprises as its customers. When complaints about lackluster performance levels arrived from a small group of its European IT clients, the company found the problem was due to one of its infrastructure providers, which had an issue when one of its network providers ran into problems updating a switch in Germany. The SaaS customers with performance problems had been routed through that switch by their communications providers. So who was at fault? And how was the SaaS provider to resolve the issue? Cases like this illustrate the hidden challenges of today's dynamic global supply chain. To be sure, virtualization technology and cloud services provide IT with access to huge pools of resources, lower up-front costs, and less effort and delay than ever before. But when an IT service has an issue, the cause may reside deep within a multilayered maze of providers' — and their providers' — IT infrastructures. How do CIOs monitor cloud providers to ensure that they are fulfilling their contracts and meeting business goals? One solution to this new challenge lies in IT's past. When all IT systems were still built and run on premises, CIOs ensured top performance by using management solutions that monitor application, network and other services. These tools, in turn, employed business measurements — selected by the user — known as key performance indicators (KPIs). In IT, KPIs today include the average completion time for a Web transaction, the percentage of support calls solved by the first-line support staff, and the average response time from a Web-based CRM service. KPIs measure the specific performance aspects that indicate most clearly whether an IT service is meeting the needs of the business. In today's new IT supply chain, a KPI that exceeds or falls below a certain threshold may indicate that a service is not performing as specified in the supplier's contract. But setting the right KPIs for monitoring a cloud environ- ment is particularly challenging. Why? Three main reasons: To measure the performance levels of IT service providers in the cloud, smart CIOs are giving a traditional metric — key performance indicators — a fresh update. | By Leon Erlanger PHOTOGRAPH: ISTOCK Smart Business T Measuring CLOUD the 42 SMARTENTERPRISEMAG.COM

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