Understanding Why the “as-a-Service” Model Works, Part Three: Making the Shift to Cloud Service

A century ago, electricity was the state-of-the-art technology that would change our world forever. Today, it’s everywhere. We pipe it into our homes and offices. We drain it from the plugs in our walls to power our appliances. Or we store it away in our devices so that we can take it with us anywhere we go. We rarely think about where it comes from or how we get it, but we depend on it to always be there. It’s a fundamental necessity in our lives.

We can say the same for digital technology. There’s no question that our devices, and the connections they provide, are essential to our daily lives. Without them, we feel out of touch. As if the world is somehow passing us by. Streaming video channels, eCommerce shopping, and wireless data plans consume our family budgets. And for all our investment in these digital services, we expect the online brands we buy from to know what we want and to deliver it to us how we want it, fast.

This always-evolving demand for digital forces companies to be innovative. As Silicon Valley startups and global tech giants drive consumer expectations, all companies have to learn what it means to be a technology company in today’s day-and-age. Manufacturers, distributors, retailers, flower shops… They couldn’t survive in today’s digital economy without mastering the technology that drives it.

As Silicon Valley startups and global tech giants drive consumer expectations, all companies have to learn what it means to be a technology company in today’s day-and-age.

Companies have traditionally met this demand by building on-premise data centers and hiring IT staff. Doing so has given them control over all aspects of their technology operations, maintenance, and innovation. They have teams that build and manage networks, servers, storage devices, databases, software, and much, much more. Their in-house IT professionals struggle to balance the implementation of best practices with the constant pressure of competing priorities. Security and administrative efficiency is a constant concern, and IT knowledge silos limit growth and agility. When led properly, a mature highly-functioning IT department and data center can be an awesome engine of innovation. But it takes an incredible investment of people, time, and money to achieve that level of competence.

At a time when the Cloud can deliver Technology-as-a-Service as easily as the Grid delivers electricity, is it still necessary for companies to have be competent in the construction and operation of IT? They should certainly know how to use technology. But do they really need to know how to design it, build it, operate it, and maintain it? Company execs were likely asking the same question a century ago when they were weighing their choice between building an on-site power plant and trusting regional utility providers to pipe electricity into their factory operations. It’s clear which option they chose.

But what options are available to companies looking to reduce their data center footprint today? If a move to the Cloud is inevitable, what “as-a-Service” services should we be using to make that move? And which ones make the most sense for your business?

IaaS, Paas, SaaS?

Let’s unpack what the Cloud is from an industry services perspective. The three most common Cloud services you will hear about are Infrastructure-as-a-Service (IaaS), Platform-as-a-Service (PaaS), and Software-as-a-Service (SaaS). Each one builds on the former. But you don’t have to buy them all to reap the rewards of the Cloud. You just have to determine how much technology you want to own and how much you are willing to contract with a third-party to do for you. Let’s look at each one in more detail:

Infrastructure-as-a-Service – IaaS offers an alternative to on-premise data centers by moving your storage and computing power to the Cloud. All of those servers, storage arrays, security devices and power backups sitting in your building and in an off-site disaster recovery location go away (or only some, if you’re not ready to give up all control). Cloud providers take care of hardware upgrades, maintenance, device failures, disaster recovery, and the facilities and utilities needed to run it all. And they commit to give you the system performance, capacity and availability that you pay them for. You may still need an engineer or two to use their tools and design the right architecture, and to keep an eye on their tech guys. But with less onsite equipment and increased administrative efficiency, you will be able to do much more innovating with much less budget.

Platform-as-a-Service – PaaS reduces your hardware costs, but it does little to reduce software costs. And as great as it can be to have your infrastructure running in Amazon’s data center, your digital plumbing is only as good as the things that you build with it. That’s where software platforms come in. Before the cloud, companies hired teams of programmers to create new software or customize vendor software platforms to meet the business’ needs. When those vendors created new versions of their software, those companies suffered the pain of expensive and disruptive outages to upgrade to the latest-and-greatest. PaaS eliminates that pain by making these platforms available to your developers over the web and by presenting your software to the outside world for you. Vendors update these platforms on a continual basis without disruption. They take care of the infrastructure running your website, the security to protect your data, and the facilities to safeguard you from disaster. Your team focuses on building the digital experiences that make you unique. And, if you want help, there are tons of software development partners ready to help you on the most popular Cloud PaaS platforms.

Software-as-a-Service – Arguably, SaaS has actually been around the longest. Salesforce.com is often credited for introducing the first SaaS product in the late 90’s when they launched their Web-based enterprise CRM platform and began selling it as a pay-per-use service to businesses. Since that time, more and more software companies have developed and delivered their software over the Web. Google and Microsoft dominate this space with their Web-based office and email tools. Unlike PaaS, you have few options to customize SaaS products to be unique for your business. Most of the applications considered SaaS today are unique software products that serve a particular need in a particular way and require a pay-as-you-go or pay-per-use subscription. When companies find a SaaS product that fits their particular need, they rarely need any help from IT to buy it, configure it, or use it, resulting in a much lower cost compared to in-house custom software. Think of Google Apps or Microsoft 365.

Why as-a-Service?

Technology is a field of industrial specialties at a time when the raw material is data. Over the last quarter century, digital technology changed the world around us. Society lives in the virtual world we’ve created over the last decade, with mobile devices and always-on broadband connections. We spend time with friends and family online. We watch movies there. We spend our money there. Although we must all be proficient users of technology, that doesn’t mean we have to know how to build it. We just have to know how to pick out the right services that we need and put them together in a way that is unique and valuable to our constituents.

I understand that trusting someone else with such a critical function of your company is hard. If you get technology wrong, it could take years to get it right. And years might as well be decades in today’s fast-paced digital world. It’s a scary risk. And I imagine it was a scary risk a hundred years ago when factory owners gave up their on-site power plants. Still, they did it. And look where we are now. Imagine what it means to be able to depend on reliable technology services. All we have to do is do what we do best. Use it to create something amazing.