In a market practically defined by do-it-yourself provisioning, the notion of cloud professional services seems almost like an oxymoron. Professional services come at a premium price, and cloud computing is, in many ways, a commodity. Yet for that exact reason, cloud providers are acutely aware that improving the profitability of the cloud model hinges on finding a way to boost revenue through complementary services.
IBM, recently named a leader in IDC's MarketScape for cloud professional services, is finding ways to articulate the value of these services to customers across several markets. Ric Telford, the company's vice president of cloud services, recently spoke with SearchCloudProvider about how IBM has gained that edge.
What separates IBM's cloud professional services from the competition, and how has the company cultivated this strategy?
Ric Telford: Obviously, a lot of the initial interest in cloud computing as a delivery model was to really focus on optimizing the efficiency and the cost of IT, and that's very important. But what differentiates IBM is that from the beginning, we've looked at this as, "How can this technology and set of capabilities transform businesses?" That is, how can it transform the way people conduct their business, rather than just how does it make them more efficient? When you look through that lens with cloud, you prioritize things that you may not otherwise if you just look at it purely as a technology. That's the way our professional service teams work.
[Our teams] have looked at how they can leverage cloud computing and helping people, whatever industry they're in -- whether it's in retail, manufacturing, government or healthcare. That's sort of the lens we've looked through, and I think that's apparent when you see things like the IDC results -- that IBM is very much focused on business value of clouds.
How do you balance the need to tailor services for various verticals with the fact that IBM is, of course, a huge organization and needs to maintain some economies of scale -- especially in cloud?
Being able to act quickly but think strategically is really what we impress upon our clients because there had been too many dead ends in the past in IT.
Ric Telford, IBM
Telford: One of the things about cloud computing in the delivery model is that it allows quicker time-to-value for solutions in general. I remember, 10 years ago, we would constantly, in IBM, come up with great ideas for what we now know as Smarter Planet solutions. We could build a system to better manage water, or we could build a system for better tracking of food recalls. We had no shortage of [ideas], but the up-front cost to get those solutions -- very industry-specific solutions -- up and running could be prohibitive, for the very reasons that you said.
But when you have a platform that allows you to pay as you go, dynamically scale, only pay for what you use, and allows you to what we call 'fail fast,' [meaning that] you can create code, create content quickly and change it quickly, only having one instance up in the cloud, rather than having to send out updated diskettes [to various data centers]. The whole economy of [vertical] solutions is very different than it was in the pre-cloud years.
In a market that is so driven by pennies-per-hour pricing and self-service provisioning, how do you communicate to customers the value of professional services and consulting?
Telford: There's no one magic answer to that, other than having smart people in the room, working day in and day out with the client. I will say some of the things that we do right up front is we take them through our model, our approach and the deep thinking we've already done in the space.
Being able to act quickly but think strategically is really what we impress upon our clients, because there had been too many dead ends in the past in IT. I recently blogged about how several years ago I was having these conversations with CIOs or IT directors [who] had undertaken virtualization because that was the key thing to do -- to virtualize. They said, 'Rick, we've ended up with, in some cases, more problems than we've solved. We've got everybody creating virtual machines. We have no catalog of what [version] of software is in each of these virtual images. We have software costs for what we have to buy to run the virtual machines.' They've experienced this problem before, where they jumped on a new technology and didn't think strategically about it and ran into trouble.
I think a lot of the companies I talk to realize cloud is something pretty big, and they want to make sure they've thought it through and have a good strategy going forward. We've done a lot of that thinking already. They don't have to reinvent the wheel. We can tell them all the problems they can potentially have and what the solutions would be, [such as] data integration, business process integration, the ability to ensure that you have the proper security and the proper performance levels. Those are all top of mind for our IBM professionals.
From a broader market perspective, what are some areas where cloud providers could improve their professional services strategies?
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Telford: In the area of professional services and when it comes to cloud, you can't lock in on one right answer, because the right answer for a company today in cloud and the way they adopt cloud could be the wrong answer three years from now. If there's only a one-size-fits-all solution being proposed, that's probably not the right way to go.
Having the breadth of the IBM portfolio both up and down the stack, as well as the different deployment models -- hybrid, private, public -- gives clients a lot of options when we're working with them on their cloud strategy. I think that's something that everybody needs to think about when they're thinking about cloud. [Clients] don't want to get locked in on one approach.
Another [issue] is vendor lock-in. When we talk about cloud, we talk about it being open. Everything IBM does in cloud is assuming a future where we believe the cloud, much like the Internet that it rides on should be built around open standards and open source. HTTP, HTML, TCP/IP -- all open standards with open source implementations -- made the Internet so ubiquitous. We believe cloud needs to be the same way. So IBM has been a big proponent of open standard and open source in the cloud realm as well.