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Why Cloud Financial Management is a Requirement for Cloud Computing Success

July 11, 2013 at 11:23 am PST

photo-David-Linthicum-cropped-481x198Guest Blog: David Linthicum, Cloud Computing Visionary, Author, Speaker

Cloud Cruiser and Cisco have partnered to provide an out-of-the-box cloud financial management system for Cisco Intelligent Automation for Cloud. Through this partnership, Cloud Cruiser provides visibility into the costs of physical, virtualized, and cloud resources, as well as storage, network, application, and non-compute IT resources. We can track both the costs and the revenue realized from services being deployed, which enables service providers and enterprise IT departments to manage the profitability of their cloud services and align their business goals with IT spending.

I’m proud to be participating in a Webinar co-sponsored by Cloud Cruiser and Cisco, which will discuss the topic of cloud financial management.  Why?  Well, cloud financial management is one of the more important concepts in the world of cloud computing.  Yet, it’s also the most misunderstood.

While many cloud providers think of cloud financial management systems as mere billing systems, they are much more.  The core notion is to approach cloud financial management as a set of business processes and automated services that need to coexist with the existing cloud computing services.  These services leverage an on-demand, pay-as-you-go cloud model.  They offer a complete cloud financial management solution designed to lower IT costs, and profitably scale the cloud services business.

The objective of a cloud financial management system is to provide cost transparency, which will allow the service providers to see all costs.  Moreover, it will show how they map to resources consumed, as well as provide this information to the consumer of those resources.  Moreover, the concepts and technology should give the cloud provider cost accountability features, which allow charges to be assigned to the appropriate consumer of the cloud services, and in the appropriate amounts.  This includes either internal or external cloud service consumers.

The use of cloud financial management, as an approach and underlying technology, should offer the cloud provider cost empowerment, which allows the cloud financial management system to place fine-grained data in the hands of the customer (service consumer) so they can manage costs directly.  Finally, there is a need for cost management.  This will allow those charged with monitoring cost to understand the use of the resources, and make sure that costs are in line with the budgetary constraints of the service consumer.

So, just billing systems?  Hardly.  As more service providers come on-line, offering up everything from pre-built business processes that are on-demand, or centralized security and management services, to more traditional IaaS, PaaS, and SaaS, the need for cloud financial management technology grows.

The use of a cloud financial management system is a requirement for cloud service providers to manage and control costs, as well as provide the proper cost and usage accounting for their customers or cloud service consumers. Cloud financial management systems, such as the Cloud Cruiser Platform, provide most of the features and functions that service providers will require, including:

•  Heterogeneous data collection

•  Data analysis and structuring

•  Data aggregation and filtering

•  Hierarchical data mapping

•  Cost and price modeling

•  Budget alert processing

As cloud providers grow in numbers, the use of these systems will no longer be something that’s desirable.  It will be an absolute necessity, given the growth of cloud computing services, and the number of consumers who leverage these services.  Costs have to be monitored, analyzed, and controlled in order for cloud computing to be a business success.

This webinar is not to be missed!

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Financial Management for the Enterprise Cloud

One of the most exciting things about Cisco Intelligent Automation for Cloud (Cisco IAC) is its ability to deliver the self-service agility and flexibility that a business requires to drive its success.  Capacity is instantly available when needed, enabling creative innovation to bear fruit much faster (think research institutions executing millions of computations, software engineers developing new applications, or retailers launching holiday marketing campaigns.)

The benefits of cloud computing are obvious but what about the costs? For example, how do you know which resources a particular project is tied to and whether it makes good business sense?  How do you make sure your users shut down services when they’re no longer needed?  And how do you implement a cost model to charge back IT costs to the proper business unit or project?

These are questions that are bubbling to the surface of many enterprise cloud discussions, which is why I’m particularly excited to announce our new partner, Cloud Cruiser.  Cloud Cruiser has integrated their financial management system with Intelligent Automation for Cloud, enabling enterprises to take control of their IT spending and use the granular cost information it gathers to drive better business decisions.

By implementing a financial management solution designed for the cloud, enterprise IT becomes a partner to the lines of business, providing valuable insight into the IT costs associated with the projects and applications they deploy.  Chargeback gives business units the advantage of only paying for the resources that they use, resulting in both a reduction of waste (who wants to pay for those VMs that are no longer being used?) and more educated IT spending decisions, such as whether to use internal or external IT resources for a particular project. Self-service budgets and reports make users more fiscally responsible for the resources they deploy, driving costs down and productivity up.

In short, Cloud Cruiser and Cisco Intelligent Automation for Cloud work together to help enterprises make the most of their enterprise private cloud by delivering better service at lower cost.

To see how Cloud Cruiser for Cisco Intelligent Automation for Cloud works, view this short video:

Read the joint solution brief and web page to learn more about Cloud Cruiser for Cisco Intelligent Automation for Cloud.

 

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