Enterprising Developments

Is the Elasticity of the Cloud for Everyone?

Joe McKendrick
Insurance Experts' Forum, June 1, 2012

Elasticity ranks right alongside cost savings as benefits seen by the cloud. Having cloud resources at the ready provides companies tremendous flexibility when spikes in demand come up.

However, for many companies with fairly static workloads, well, it depends.

In a new post, Roger Lawrence, CTO of strategic enterprise services for HP, discusses the ins and outs of elasticity, particularly as it's addressed by the cloud. Elasticity is the answer to the question of how to deal with incredible and unpredictable spikes in demand. Elasticity via cloud is great “if you’re Facebook or Twitter or a stock trading broker dealing with IPOs,” he points out. But for banks, retailers and insurance companies, the advantages are a bit murkier.

To determine how elastic you need to be, consider the two main types of systems you have on your premises: there are “core systems” that run the core business, which are absolutely essential to the functioning of the business. Then there are “context systems,” the systems that allow the various departments to perform business processes, such as human resources, messaging, payroll and customer relationship management. “If these systems go down, you can still hire people, call each other by phone and instruct the bank to run last month’s pay run as an emergency.”

Context systems usually go into the cloud first, he observes. But since most companies only grow at a rate of 4 percent, the scaling of peripheral context systems may be difficult to justify. Also, Lawrence continues, consider the fact that an entire enterprise rarely needs elasticity—usually, it is limited to specific functions and servers.

The bottom line is that no two IT infrastructures are alike, and elasticity requirements need to be evaluated before cloud contracts are signed. At the same time, cloud offers a means to balance any shifts in system requirements.

Joe McKendrick is an author, consultant, blogger and frequent INN contributor specializing in information technology.

Readers are encouraged to respond to Joe using the “Add Your Comments” box below. He can also be reached at joe@mckendrickresearch.com.

This blog was exclusively written for Insurance Networking News. It may not be reposted or reused without permission from Insurance Networking News.

The opinions of bloggers on www.insurancenetworking.com do not necessarily reflect those of Insurance Networking News.

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