Cloud computing is helping corporate chief information officers overcome their fear of failure, and is opening the door to the kind of blue sky thinking that can foster real innovation. It is also forcing IT managers to adopt a fresh approach and deliver on the mantra of doing more with less because they can be increasingly liberated from the financial and time resources required to keep the lights on.
Altium is an ASX-listed company which develops cloud applications for electronics manufacturers. Its CIO, Alan Perkins, believes that a lot of businesses are afraid to move away from their legacy IT systems, which limits their ability to think about the possibilities of innovation.
"A lot of businesses would be fearful of the success that in the cloud model you can hope for," Perkins says.
"Blue sky thinking opens the door to innovations. Fear of success can be very limiting.
"CIOs feel that they have to be a fearful bunch. They have a well known reputation for being the gatekeepers rather than enablers in a lot of systems.
"The whole cloud world enables them to say, 'what can we do' rather than 'why can't we do x.' "
This is best demonstrated by the notion of "failing fast" whereby businesses can now quickly experiment with a new technology or system to observe how it works in real-world conditions.
Based on the results this can be pushed into production or taken back to the drawing board.
If you know very quickly if something works or not, Perkins says, you can be bold without investing a lot of money or resources into something that would otherwise be a dead end.
This concept was adopted at Altium to test an innovative database design. Perkins needed to see if it could scale to billions of records and also handle thousands of concurrent users on cheap hardware.
The latter was the trickier of the two, he says, and the test required 11 machines – one database and 10 automated client machines pretending they were 1000 simultaneous users (effectively 100 users on each machine).
It would have previously been an arduous and costly test that would've taken weeks to months.
However he used cloud services, which are available from a number of suppliers (in this case, Amazon Web Services), and said it was completed in a matter of hours for the price of a cup of coffee.
"So I wrote a test harness to basically simulate a thousand simultaneous users," Perkins says.
"Traditionally, you would need to go buy 10 or 11 computers, spend a couple of weeks to set them up, run your test and analyse the results.
"Because of ability to do this in the cloud, I was able to set up machines in half an hour, run the tests in three hours and shut the whole thing down never to be heard of again.
"I was able to look at my results and the total cost was under $5."
The test showed him that the threshold for the number of users was around 350, far below the goal of 1000, and he was forced to go back to the drawing board and redesign the model.
Despite the lack of immediate success he says the fact he used cloud infrastructure meant he had learned his lessons quickly, and with minimal expense, and could then respond accordingly.
"It involved quite a structural change because we were able to look at a different model that solved the problems in a different technical way," he says.
"We could do it without investing too much time and effort in exploring that other way."
The ideas of failing fast and doing more with less were previously corporate jargon but cloud services have brought these words to life.
Such services have ushered in a refreshingly different approach, according to Paul Miller, group manager of information systems at energy drinks maker Frucor.
"The best innovation actually comes around when people are asked to do more with the same or less," Miller says.
"You have to challenge some of your core ways of thinking and ways of spending your money before you can actually go to that level of change."
Frucor is a fast moving consumer goods company with operations across Australia and New Zealand, and is most famous for its V energy drinks.
Miller says the company is forced to innovate to compete with the likes of the much larger competitors, such as Coca-Cola Amatil.
He said the company has achieved this better since tapping outsourcing firm Fujitsu to host its SAP enterprise resource planning (ERP) system.
The move has freed up the infrastructure, time and financial resources to tackle "sexier" projects that the business management wants to pursue.
This has included rolling out 110 iPads to sales staff to replace its Windows mobile fleet.
This is a significant achievement in the low-margin, high-volume world of fast moving consumer goods.
"From an outsider's viewpoint it's hardly the coolest tech, because everyone is trialling an iPad," Miller says. "But if you think about the size of the players, the complexity, and margins we work on in the FMCG (fast moving consumer goods) business it's not something as easy to change as you think.
"Doing it within the budget and being able to focus a small information systems team on such a significant level of change, you get that opportunity because of cloud."
He says Frucor expects the devices to be rolled out by early next year, and that it will then develop some innovative technologies on top of this to deliver additional value to the business.
These kinds of tangible technologies are increasingly important to CIOs, who can often struggle for recognition inside big corporations.
Chief executives will not be impressed by a CIO simply because they are doing an effective job of maintaining the status quo but will traditionally only notice their tech executives in earnest when the systems crash. and feathers are flying.
As technology becomes more ubiquitously understood, the executives in charge are coming under more pressure to demonstrate that they are taking a leadership position.
"It's a good opportunity for people to think about not doing the same thing," Miller says.
"You don't win any prizes for continuing to run your ERP system in your very old expensive servers and keeping a bank of engineers staring at those in house.
"Now with cloud you can have some decent hardware at decent prices."
Altium's Perkins says these benefits can then be delivered to customers.
"Because the whole thing about us is enabling others to innovate. Innovation is a core to the culture so it's very important," he says.
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