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CIOs adopt down-to-earth cloud strategy

Ann Bednarz | Oct. 15, 2014
For CIOs at these large companies, being selective is the key to cloud success.

Conversely, Dow Chemical has moved more infrastructure than apps to the cloud. The company finds this easier to justify financially because those are largely commodity services, whereas applications offer competitive advantage, says Paula Tolliver, Dow's CIO and corporate vice president, business services. That is, Dow wants to keep closer tabs on key applications, to respond to nuanced changes in business strategy, she says.

About 10% of Dow's applications are in the public cloud, hosted by external vendors. Looking ahead, about 30% to 40% of applications are expected to be in the cloud in three years. "We're very optimistic" about the cloud, Tolliver says.

Meanwhile, Dow runs a private cloud for some of its applications and infrastructure, to experiment and learn. Dow's private cloud delivers a lot of the benefits of public cloud, and it positions the company for future public cloud migrations, Tolliver says.

The appeal of cloud
The Vanguard Group is pursuing all aspects of cloud computing: IaaS, SaaS and PaaS in both public and private models. Speed to market, higher utilization and improved productivity have been the biggest gains for the investment firm, which manages approximately $2 trillion in assets.

"For us, cloud computing is highly cost effective; we believe in the utility-based computing model," says CIO John Marcante.

Land O'Lakes, with $14 billion in annual revenue, is using a lot of SaaS, especially when compared "to other companies our size," says CIO Mike Macrie. Database, sales force automation, CRM, EDI, travel and expense--and more--are all residing in the cloud. The cloud has been so successful a  technology that the portion of the overall IT budget spent on SaaS has grown from 10% to 30% in the past two years.

Macie says he's "getting twice the service -- uptime, reliability -- for the same level of cost" as before cloud was introduced into the company. And the time needed to implement a business request is cut in half "in many cases," he says.

Some of the same attributes attracted Humana to the cloud.

"There's a natural draw toward cloud as a technology. It introduces flexibility and capability that didn't really exist before," says Brian LeClaire, CIO at health insurance provider Humana.

"We use private cloud to share capabilities around data centers, and then leverage interconnectedness" to link elements that are private and public, LeClaire says. "Now we're moving into software-defined data networks. That last layer is becoming highly virtualized -- server, data, network virtualization."

Western Union has selectively deployed cloud apps, including, Workday for human resources, and several offerings from Adobe for online customer experience, data management and analytics. The company is taking a prudent approach to leveraging cloud for infrastructure.


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