Cloud computing, like any new technology, should make financial sense.  An example of an ideal cloud application is one with minimal use for months followed by huge spikes (e.g. sites that process taxes, yearly stockholder proxy votes, etc.).  This makes sense because of the ability to “dial up or dial down” resources in the cloud.  While this is a specific example, there’s a more general guiding principal behind moving to the cloud.

Ultimately, cloud computing allows IT staff to focus on strategic business issues and systems vs. base infrastructure.  Because of this, when systems need to be upgraded, it makes sense to consider cloud based solutions.

At Intertech, as we look to renew licenses for on-premise servers, we’re doing a compare, contrast of hosting inside our walls vs. hosted.  For most of the off-the-shelf software we use to run our firm, from CRM to our mail server, we’re finding cloud based solutions are more economical.  As noted, they also allow our IT folks to focus on areas that make our firm strategically different (such as our world-class online classroom training infrastructure/solution).  We’re not alone in this thinking. 

Andrew McAfee, of MIT, states the cloud is ideal for IT groups “stretched thin” and the cloud offers an opportunity to pursue new activities “nimbly” and “cost effectively.” For further insights from Mr. McAfee, check out the November Harvard Business Review.

Before diving into cloud-related pros and cons of cloud computing, let’s do a quick summary of the three primary cloud computing service offerings:

IAAS:  INFRASTRUCTURE-AS-A-SERVICE.  This is the simplest.  It’s similar to hosting.  In short, it’s one or more servers in the cloud.  The benefit is flexible storage and bandwidth.  IAAS allows outsourcing of the machines and base technology (OS).  The management of what runs on the IAAS is up to you or your IT provider.

PAAS:  PLATFORM-AS-A-SERVICE:  PAAS allows firms to be up-and-running quickly on a platform like Java, .NET, or Python.  With this platform in place, you can quickly provision an application development space for developers.

SAAS:  SOFTWARE-AS-A-SERVICE:  This is the largest, and most mature, of the offerings.  It’s simple to use.  SAAS is software accessed over the web (think gmail, Microsoft 365, or, the granddaddy of SAAS, Salesforce.com).

Intertech had a record 2011.  Luckily, we hit or exceeded all of our goals except for one.  The goal was around creating custom cloud-based applications.  With all the hype around cloud computing, it left me asking “Why?”

We believe cloud computing is the future of IT.  From creating Microsoft’s course on Azure to national briefings on cloud computing, we’re working to be the best provider of cloud-based development services.  At first, I thought it was our client base.  Turns out, our clients are not alone in their movement to the cloud.

InformationWeek in a 2011 survey stated only 29% of respondents analyzed the impact of the cloud.  Further, Gartner, a leading research firm, predicts:

• Cloud computing will grow at 19 percent per annum thru 2015 (sounds like a lot)
• Cloud computing in 2015 will account for < 5% of worldwide IT spending (yet... seems surprisingly small)

So, given the above, why should companies care about the cloud? 

Here are a couple of reasons and examples… leading thought leaders like MIT scientist Andrew McAfee states the economics of building and running a technology infrastructure favors the cloud vs. on-premise computing.  The CIO for the U.S. called for moving a quarter – or $20 billion – of fed IT spending to the cloud.  That’s a heavy bet for the CIO of our country.  As a CEO, have you given much thought to the implications of the cloud?

• Do you think the cloud will displace you or your department?
• Because “cloud” is overused, almost like the word “leadership”, are you unsure what “cloud computing” means?
• Are you concerned about the benefits vs. risks?

If you answered yes to any of the above, my hope is one of my next posts will help.  In part, it’s information from the article, “What Every CEO Needs to Know about the Cloud” by Andrew McAfee, Harvard Business Review (HBR) November 2011.

Remember when everything was being renamed with a “.com” in the early 2000’s?  I bought the hype.  I made a decision to split our training and consulting offerings into separate brands.  Intertech would be the brand for training.  “go-e-biz.com” would be brand for consulting.  For go-e-biz, we were trying to communication we could help customers “go into e-business.”  I’ve made better decisions.

Our clients had questions like “Was go-e-biz.com made up of different people?  Were we only interested in clients selling over the internet? Were we jettisoning our training business” While the answer was “no” on all counts, I created confusion.

Years later, we reunited our offerings back under “Intertech.” While a branding mistake, there were upsides:

• Today, we also have different marketing plans.   We have different teams sell training and consulting.  Because they’re different products with very different sales cycles, the separate focus is good.
• The reunification, thanks to a great marketing consultant, made us, once and for all define a simple brand that says who we are… “Instructors Who Consult, Consultants Who Teach”
• As we reunited, we got lucky and were able to purchase Intertech.com (until this time, we had used variations for our domain like Intertech-Inc.com).  

For me, I learned to take time to take time when making a decision, ask questions, and think more strategically. 

Losing a client is rarely good.  Losing one who’s over half of sales is brutal.  It happened to us in a big way 15 years ago. 

Our main client was sold.  The new company put new people in charge.  Our new point of contact called an end-of-day Friday meeting.  She quickly, and abrasively, fired us on the spot.  As we pulled out of the parking lot, I realized we had a couple of choices – have a plan and get new business (quickly) or let people go.

We did some simple things.  Over the weekend, we made plan.  On Monday, we shared the plan.  As a team, we worked hard, had regular updates, and engaged in meaningful work.  It worked. 

No one was let go, we diversified, and we grew.

After it passed, we started, both formally and informally, identifying potential problems and our response, before they happened.  This allowed us to define solutions in the calm light of day versus the heat of battle.

Beyond lessons for the firm, I learned:

• Action cures fear.  If I’m busing working on something, it’s hard to focus on failure.
• "A fish rots from the head down.” This Italian saying means simply when stuff isn’t right, if I’m in charge, I should look in a mirror for who’s responsible.
• As a leader, I set the tone and tempo.  If I want to see others be anxious and panic, I should be anxious and panic (in disclosure, at the time of the major client leaving, I hounded our salesperson relentlessly... sorry Ryan).

Epilogue:  The client gets rid of the abrasive manager (and others).  Within about a year, we’re asked to return along with solid leaders of that firm who were also exiled.

A Harvard business Review article this year, “Building Resilience” by Martin E. P. Seligman outlines the Army’s plan to not only reduce the number of people going thru Post-Traumatic Stress Disorder (PTSD) but to increase the number who “grow” after PTSD.

Growth, not just recovery, is one of the goals.  Though the trauma of war and losing one’s company (like Jobs at Apple) are not in the same ballpark, it is interesting the Army is helping service members use difficult experiences as a catalyst.  Seligman writes, “Thirty years of research suggests that resilience can be measured and taught.”

Because resilience can be taught, the Army has created courses to help soldiers increase positive emotions, be aware of negative emotions not in proportion to a threat, and build people skills including—creating trust, dealing with conflict, and defining shared meaning. 

There’s even a course on “spiritual fitness” (where spiritual means belonging to something larger than yourself—not religion).   This course covers self-awareness, sense urgency, self-regulation and motivation.   As a leader, it’s helpful for me to think thru these qualities for myself and my organization.  As noted at the start of this post, it’s also an important reminder that adversity can be a catalyst.

Steve Jobs was extremely successful and unmatched in vision.  He started Apple at the age of 20.  Ten years later, he was fired from the very company he started.  Jobs stated it transformed him.  It made him better. 

Within two years of his departure, he starts NeXT Computer (later NeXT Software) and buys a division of Lucasfilm.  Similar to the iPad, he created an industry.  The division of Lucasfilm  became Pixar and created movies like Toy Story, Monsters, Inc. and Up.  NeXT had its ups and downs but once again, Jobs had vision and success.

He started NeXT with $70M of proceeds from his sale Apple stock.  Years later, NeXT is sold back to Apple for over $400M.  With the sale, Jobs was back on track to the helm of Apple.  While NeXT is not a household name today, in 1985, a NeXT computer was the first server in the World Wide Web.

Vision, dedication, and belief can overcome failure.  This was indeed the case with Jobs.  A Harvard Business Review (HBR) had an issue related just to failure and this will be the focus of my next several blog posts.

Guideline #6– Don’t insist that a decision must be made

“Conventional management wisdom holds that a flawed decision is better than no decision,” writes HBR author Charalambos Vlachoutsicos.  He further states we shouldn’t “rush to impose one.”

For me, this is one of the toughest beliefs to avoid as a leader.  If you’re leading a firm, a team, or a startup, you got to where you where you are by, most likely, making decisions, standing up for what you believe in, and taking action. 

When does it make sense to debate or make a decision? 

I think there’s a simple rule.  If there are new points, new dialogs, or new debates around a decision, it’s a sign that more dialog is needed.  On the other hand, if you’re finding points are being restated louder or re-swizzled in different (but the same) words, as a leader we need to do one thing… make a decision.

Finally, for those whose input didn’t result in the decision they wanted, close the loop.  Make sure they understand why you made the call.

Guideline #5 – Don’t try to have all the answers

HBR author Charalambos Vlachoutsicos writes “Problem solving is central to the manager’s sense of self.” Further, “feelings of inadequacy can surface when a solution is elusive.” When a solution is elusive, a simple remedy is to involve others.

Involving others results in better solutions or confirmation you’re on the right track.  Obviously, having the right people involved is key.  For me, the right people:

• Are confident enough to speak their minds
• Put the interest of the firm ahead of their own agenda
• Are comfortable with intellectual conflict
• Can listen as well as they speak

The final part of having the right people, even more important than the points above, is having people who are willing to roll up their sleeves and do the work.  In fact, when asked to name the main reason for the success of their companies, 75 percent of the CEOs leading Inc. magazine’s top 500 companies said “superior execution in a mundane business.”

Guideline #4 – Focus the Agenda

In the article by HBR author Charalambos Vlachoutsicos he addresses meetings and agendas.  Specifically, it’s about meaningful meetings.

At Intertech, we’ve established a meeting “rhythm” where once a day the leadership team huddles (checks in) with one another.  These meetings are:

• At the end of the day
• Short with a simple agenda:  Big updates and stuck items (problems)
• Limited to 15 minutes

For huddles, it’s important to let participants know its O.K. to pass if they don’t have significant, group-worthy updates.  I make it a point to say, “I don’t have anything group worthy” if that’s indeed the case.  Going thru every detail of the day, with information that doesn’t benefit the group, wastes time.  In addition, it feels like micro-management.  When we’re doing our huddle and have a larger issue, we put it in a parking lot for our workout meetings. 

Our workout meetings are:

• Held once a month
• Scheduled on a standing day and time
• Have an agenda built over the course of the month

The two meeting types and agendas allow us to stay on top of the business and have meetings that matter.