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Smart Enterprise: Greater Expectations

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individual transactions and users. The solution also provides insight into any applications the customer may be running. CA Infrastructure Management products provide deep network, systems and database insight that domain experts require, and tie into a real-time operations model to help illuminate the big picture of business service analytics for service quality, health and risk. "CA and others have put a tremendous amount of effort into making sure enterprises have the tools to benefit fully from the cloud," says Adam Reeves, a Senior Product Manager at CA Technologies. In addition, new frameworks are being developed to help CIOs compare and contrast their internal IT resources with those in the cloud. (See sidebar, "A Framework for Cloud Comparisons," p. 45.) But even with solutions in hand, CIOs will need to do their homework when setting cloud-worthy KPIs. One place to start, industry experts say, is with a deep and detailed understanding of who is responsible for which aspects of a specific IT service. "You really need to understand responsibilities, roles and process requirements," says Dennis Drogseth, VP at Enterprise Manage- ment Associates, an IT analyst and consulting firm. "You need service providers who are willing to sit down with you as a partner, and work with you and your users to understand the boundaries." When working with cloud providers in this way, CIOs should explain what matters to them — and to their enterprise colleagues. "If an enterprise is looking to move its CRM business capability to the cloud, a representative of the cloud provider should meet with the client's VPs of sales, supply chain and IT," says Claude Baudoin, Principal Consultant at cébé IT and Knowledge Management, an IT strategy and governance consulting firm. "IT will have input on how the service will be integrated and how master data will be handed off to the provider. The supply chain knows about contract terms. But it is sales that knows the business requirements and how quickly new customer records need to be available." CIOs also need to determine which cloud service is responsible for what services, then seek measurements that accurately reflect the needs of the business. For example, while IT might define a metric for a backup service in terms of bandwidth, the user simply wants to know how long his 20-megabyte backup will take. "IT has its own set of metrics it feels comfortable with, but they may have little to do with the end users of the service," Baudoin says. CIOs can get a better handle on business metrics by thinking about application performance, specifically applications that enable transactions. "IT's products, for the most part, are appli- cation services," says analyst Drogseth. "Everything else is just a means to that end." Another important KPI: cost per transaction. Is the business getting its money's worth? Is the business paying the same or less than it would for those transactions if the system were run in-house? Or, as Radu Sion, Assistant Professor of Computer Sci- ence at Stony Brook University, says, "You may want to know that a 10 microcent in-house transaction costs you only 1 microcent with a cloud provider at the same [service level agreement] levels." The cost analysis must include not only the cloud provider costs, but also the in-house costs of the infrastructure needed to access that provider, adds Sion, who is also head of New York State's Cloud Computing Center. Other KPIs may be specific to a business or IT function. An organization monitoring a cloud provider's technical support help desk might want the provider to report its response times, number of dropped calls, and first-line resolution times; or, the organiza- tion might arrange to monitor it themselves. Security, meanwhile, might want to monitor encryption performance, or even to arrange a security audit or obtain backup log files to determine whether a supplier is providing adequate disaster recovery. By taking the business factors a step further, CIOs may even be able to pack KPIs with real business impacts. "Once you start marrying THREE STEPS TO CREATING CLOUD-WORTHY KPIs Start with a deep and detailed understanding of which provider is responsible for which aspects of a specific IT service. Understand responsibilities, roles and process requirements. The goal: service providers who can work as true partners. To help your cloud providers understand what matters to your business partners, arrange meetings of all interested parties. For example, if you're moving your CRM to the cloud, then make sure your cloud provider meets with your VP of sales. Seek or create new measurements that accurately reflect the needs of the business. This may require metrics that are centered not on IT, but on the business. For example: How long will it take to back up files? How many steps are needed to add a new customer file? And how much does it cost to fulfill an order? —L.E. 1 2 3 DATA: Smart Enterprise, 2010 PHOTOGRAPH: THINKSTOCK 44 SMARTENTERPRISEMAG.COM

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