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Public cloud services a must-have for many companies

Two use cases suggest moving to public cloud services is no longer a choice; it's a reality of doing business in the 21st century.

Of all the signs pointing toward cloud computing's maturity, here's one of the most telling: For many organizations,...

moving to public cloud services is no longer a choice so much as it's an unavoidable reality of doing business in the 21st century.

Solairus Aviation is just such an organization. The company, which manages aircraft for corporations and high-net-worth individuals, was formed in 2009 when a private equity rollup of small aircraft-management firms went bankrupt. Sensing an opportunity, CEO Dan Drohan recruited people from several of those companies and formed Solairus, forming ties to as many of the aircraft being left in the lurch as possible.

As the company established itself and it became clear that it could gain a competitive advantage from how it managed information, Drohan brought in Mark Dennen as CFO and de facto CIO. It didn't take long for Dennen to identify Solarius' limited IT capabilities as an obstacle to the company's plans.

"I knew at the rate we were growing, we could not continue to run our business in a Quickbooks environment," Dennen said during a recent phone interview. The company had bolted its homegrown billing module to Quickbooks, resulting in a semi-automated process that required data to be manually imported and manipulated. As clunky as that was, Dennen said "the final straw" came when Quickbooks went down for a week.

A review of the landscape led to the unavoidable truth: Because it lacked the IT infrastructure needed to support on-premises business applications, economics dictated that the company would have to go with a software-as-a-service (SaaS) provider if it wanted top-of-the-line functionality and reporting. Its search led to Oracle's SaaS-based ERP and human resources cloud services, and a months-long implementation went live January 1.

Now Solairus, which has teams managing 80 aircraft at 50 facilities around the country, is able to provide its clients with granular information about their aircraft, as well as invoicing and payment histories, via an online portal. Dennen said he expects this capability to quickly separate Solairus from its competitors.

"No one else is doing this," he said. And SaaS made it economically possible by diverting the huge up-front costs of on-premises systems. "We know that over time we'll end up paying more for the product than if we did it ourselves," said Dennen. "But if we did it ourselves, we couldn't have afforded it."

Solairus' story is one that's shared by countless companies, whether they have an overtaxed IT team or no IT team. Most simply don't want to be distracted from their core business activities, and public cloud services are letting them stay focused.

"When you have a lot of on-premises apps, your IT team tends to spend a lot of time on upgrades and keeping applications from breaking," Christine Dover, an analyst with IDC, said via email. It's that resource drain that's sending so many organizations into the cloud, Dover said. "It's inevitable that many companies will make this transition."

Public cloud services modernize online education

It took Western Governors University a while to embrace that inevitability -- even though it was, itself, a cloud. The nonprofit online university was created in the late 1990s by a compendium of U.S. governors who sensed that distance-learning technologies would provide an ideal foundation for making a competency-based approach to college more accessible and affordable. Students do everything through the Web -- register, receive instruction from a network of "mentors," take exams, even interact with other students.

When you have a lot of on-premises apps, your IT team tends to spend a lot of time on upgrades and keeping applications from breaking.
Christine DoverIDC analyst

But because Western Governors began offering classes in 1999, before modern public cloud services were available, it was forced to deliver its online education environment with an on-premises IT footprint. Thanks to an annual growth rate that's typically been about 30%, the school's portfolio grew to 200 homegrown applications before it decided to consolidate some of its environment on Salesforce's SaaS platform, Dave Perry, Salesforce program manager at Western Governors, said during a recent phone interview. "We typically go through a buy vs. build," said Perry, "and initially, there was a whole lot of building going on."

Now that it has embraced SaaS and begun chipping away at that application count (not to mention its server costs and onerous security requirements), Western Governors' relationship with the cloud has, not surprisingly, proven to be a natural fit. The school has built a custom app called MentorForce, in which 60,000 students and more than 2,000 mentors interact and record studies and test scores. Another custom app, CareForce, gives students access to a personalized portal for interacting with the school. And Western Governors relies on Salesforce apps to manage such things as lead generation, course announcements and social feeds.

The school also is using public cloud resources elsewhere -- Amazon's AWS for data storage apps, Atlassian's JIRA project management app, and Interactive Intelligence's communications-as-a-service cloud-based phone system. "It's a very integral part of our decision making," said Perry. "It's proven that it's really a better solution for what we're doing."

Although Perry said Western Governors is not planning to move all of its on-premises systems to the cloud, the school has adopted a philosophy of considering cloud-based options anytime it's facing a buy-versus-build scenario. And as the technologies behind public cloud services improve, it will be harder to justify going any other way.

"Our students will need us to be more available, and our need to be available to them will continue to grow," Perry said. "The extent [to which] we don't have to worry about that is a really big deal."

Next Steps

Is the on-premises vs. cloud ERP debate moot?

Financial software moves to the cloud

Navigating the cloud financial software buying process

This was last published in March 2015

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What prompted your enterprise to use public cloud services?
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Ultimately it came down to the fact that managing a bunch of machines and their variability in a real sense proved to be more costly in man hours than in service hours. Moving into a cloud space has also helped us address multi-tenancy in a more practical way.
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