CEO Perspectives 2: Changing Misconceptions

Expanding into the cloud is like pioneering into new terrain.  Some have gone there and come back with amazing stories.  Others have moved out, lock, stock, and barrel, and keep writing letters, telling us how wonderful it is.  We may experience a longing for adventure and profit, but there are doubts and fears to overcome.  How much will it cost?  What will I have to give up?  What if something goes wrong?  How do I know I’ll be safe?

New terrain.Since cloud computing is new and unknown, it is natural that these questions arise.  For answers, we turn to seasoned travellers who have explored the new terrain and who also understand our concerns.  Last week we mentioned one such specialist, Andrew McAfee, a principal research scientist at MIT who studies how technology is changing the business world.  In his article  What Every CEO Needs to Know About the Cloud, McAfee addresses the concerns of the business community: cost, reliability, and security, in a somewhat unexpected way.  His insights suggest that we may be moving into a space where the old rules don’t always apply.

Take cost, for example.  It’s hard to predict.  There are some studies that show costs double when you move to the cloud, and yet other studies indicate that it is cheaper in the long run.  Which to believe?  McAfee says that it really doesn’t matter.  IT is such a small part of a company’s budget anyway–about 3.2% on average, according to Gartner–that cost is not a big issue.  Furthermore, with cloud providers taking advantage of the economies of scale, and with hardware prices going down all the time, the costs of cloud computing will be continually decreasing for the expected future.  So cost is not as big an obstacle as we might expect.

Reliability is another example.  People look at the Amazon outage of last year and ask, “How can we trust the cloud?”  McAfee points out that at least one company glided right through the crisis: Netflix.  They had anticipated such a scenario, and built redundancy into their system to withstand a service interruption.  So the show went on for Netflix, without missing a beat or dropping a customer.  What’s more, argues McAfee, many cloud services have a higher reliability record than on-premise implementations.  According to the Radicati Group, Gmail’s available up-time is over 99.9%, making it more than 30 times more reliable than most corporate email systems.

Whoa, hold on a minute there, partner.  We’re talking real-time here, not email.  Let’s bring the discussion up to speed and consider how all this applies to a mission-critical real-time system.  OK, the lesson from Netflix is useful.  A real-time cloud implementation should be able to provide some kind of redundancy, preferably through multiple vendors, or if not, at least through functionally isolated, physically separated systems.  At the same time, doing better than a corporate email provider sets a pretty low bar.   It begs the question:

Is it possible for a cloud system to be reliable enough for real-time data?

Which brings us to a final misconception, not specifically mentioned by McAfee, but important to us.  We need to clear up the either/or mindset.  We have to stop asking: cloud or no cloud?  Should I drop everything and move on to the bold, new frontier, or stay here with the wimps and Caspar Milquetoasts?  This is a false dichotomy.  Nowadays the cloud is more than an open public space “out there” that somehow receives and delivers data in vague and mysterious ways.  We have options, such as private clouds for tight control, and hybrid clouds to isolate the machinery, PLCs, and SCADA controls of an industrial plant system from managers and analysts who are authorized to access the plant data via the cloud.  In either scenario, the vital heart of the control system is not exposed to the cloud.

The important thing to remember is that the new frontier out there beckoning us onward is not so scary or inaccessible as it may seem.  It is possible to build an outpost, and still hold the main fort on your real-time data.  However, there is at least one more area of misconceptions to look at: security.  We’ll talk about that next week.

CEO Perspectives 1: Surprise Benefits

Recently the Harvard Business Review reprinted an article by Andrew McAfee titled: What Every CEO Needs to Know About the Cloud.   McAfee is a principal research scientist at MIT who studies how technology is changing the business world.  In addition to providing a clear, concise introduction to cloud computing for a CEO, McAfee suggests that we don’t really know all the implications of cloud computing, and he points to a number of benefits that might come as a surprise.

To shake us out of our old habits of thinking, McAfee compares the shift from traditional IT into the cloud to a shift that took place in factories a century ago when steam power was replaced with electric power.  There were real costs involved in such a fundamental change: completely rebuilding production lines, buying and installing new equipment, and retraining or rehiring staff.  At a time when power was distributed mechanically from a central steam engine, few people could envision a factory where each tool has its own built-in electric motor.  Now it’s impossible to imagine ever going back.

In the same way, argues McAfee, the benefits from cloud computing often come in ways that exceed expectations.  He gives an example of a global contracting firm that implemented a cloud solution to provide remote access to reference data like estimates, blueprints, and images.  The time savings on data retrieval were substantial, and yet the company soon found out that a major bottleneck had been unexpectedly eliminated as well.  Before, to collaborate on such projects, an engineer would have to wait for the IT department to add the new user, give clearance for the FTP server, and provide space.  With the cloud system, the engineer can quickly enter the necessary access information and bring in a new collaborator right away, eliminating costly delays.

The article discusses other benefits of using a  cloud-based system, including providing an enterprise-wide platform for collaboration, opening new opportunities for data mining previously considered impossible, and readily enabling a space for development and hosting of new applications.  In summary, McAfee says that the cloud “allows companies to increase the scale and power of their IT and the speed at which it can be accessed and deployed.  It eliminates administrative headaches and works across locations, devices, and organizational boundaries.”

So how do these CEO perspectives apply to real-time data?  We’ve already discussed some of the benefits to expect from putting real-time data on the cloud.  What additional advantages does this new article suggest?

From our perspective, it implies the value of providing instant access to live data in real time to users in a collaborative environment.  It hints that data mining opportunities may open up when the coming “Internet of things” is connected in real time.  It leaves us wondering what would happen if an IT department could take even a part of the 89% of IT resources currently spent (on average) for infrastructure and maintenance and divert it to projects like creating seamless interoperability among all of a plant’s legacy equipment.

It is a little too soon to know exactly what to expect.  Those who implement early will be the first to find out.  And as the technology of cloud systems for real-time data matures, they will be well postioned to reap the benefits.

Predictions for the Cloud for 2012

Every month the IBM cloudchat invites a deluge of tweets about a topic related to cloud computing.  A few weeks ago they asked for predictions for the cloud for 2012.  The replies from the all-star panel of Dr. Srini Chari, Judith Hurwitz, and Amy Wohl, as well as many others around the world came thick and fast—hundreds of tweets raining in during the hour-long session.

During the storm it was almost impossible to read, much less to ponder implications.  But I’ve had a few days now to digest the content a bit, and thought I’d share a few of these predictions, along with how they might apply to real-time cloud computing.  Here are some of the answers to the question:  Looking ahead into 2012, what predictions do you have for the industry?

Broad acceptance
Tweets like, “The cloud debate is over, it’s how do I get there now!“, “customers are no longer asking if cloud but when cloud,” and “Cloud is here to stay, evolution after distributed computing. No turning back,” make it clear that everyone was on the same page.  The common wisdom is that cloud computing will become widely accepted.  In fact, Judith Hurwitz went so far as to say, “companies that have ignored the cloud model might not figure out how to remain competitive,” and Srini Chari added, “no IT system except top secret installations can exist in isolation.

As you might expect, it was widely agreed that cloud computing will continue to grow.  Predictions included increased private cloud adoption, significant growth in hybrid cloud, and further adoption by small and medium-sized businesses.  This tweet from Tina Williams at IBM sums it up: “Everything as a service.

There is significant expectation that widespread acceptance and growth will lead to a greater number of cloud applications in both the business and consumer markets.  A number of tweets mentioned more mobile apps.  Amy Wohl pointed out that “Consumer applications will continue to push business applications to keep up.”  Another implication for general lifestyle change is that more and more people will be working and collaborating across the Internet.

A variety of challenges were mentioned, ranging from technical issues like data latency to business concerns like pricing.  Among these, you could sense an awareness of a need for expanding our vision.  “In 2012 people will finally realize that cloud is ‘not your parents IT infrastructure’ – new approaches for better outcomes,” tweeted Angel Luis Diaz, of IBM.

What about real-time cloud computing?
All of these predictions have strong implications for real-time cloud computing in 2012.  Widespread acceptance and growth of the cloud means that people working with industrial and embedded systems may start looking for cloud-based solutions.  We expect that with increased implementation of real-time industrial applications in the cloud, consumer apps using real-time data won’t be that far behind.  In fact, they may lead the pack.  Either way, any kind of real-time cloud system, industrial or consumer, will depend on an infrastructure that is neither your parents’ IT infrastructure, nor an industrial SCADA system, nor even what we typically see for cloud computing.  Real-time cloud computing will certainly require “a new approach for better outcomes.”

Benefits of the Cloud for Real-Time Data

A quick overview of any article or story about cloud computing will give you some idea of the benefits–greater flexibility and reduced cost. This common wisdom can be successfully applied to real-time applications to some degree. However, a process environment is different than an office or home, so we may find that the idea of benefits takes on a different form at times.

For example, one of the key benefits of the cloud for many companies is the flexibility to quickly ramp up their computing power for unusually large, one-time events such as end-of-the-year tax processing. This type of requirement is not so often needed for process control systems. But many of the other benefits of cloud computing do apply. Here are some ways that we believe users of real-time data may benefit from moving to the cloud:

Lower installation and maintenance costs
Cloud systems reduce the need for an end user to install hardware and software, moving much of the infrastructure to the cloud service provider. This results in reduced cost and time to install, and lower ongoing maintenance costs. Fewer IT staff are required to maintain a system based on cloud technology, as the locally hosted applications are simpler, and the client applications (web browsers) require no additional maintenance.

Reduced capital expenses
Cloud systems are normally delivered on a cost-per-use basis, or a flat monthly fee. This moves a large portion of the cost of implementation from a corporation’s capital budget to its operating budget. Costs are deferred into the future, and can be predicted with accuracy. Many valuable projects are never done simply because the initial capital costs are too high. Cloud systems remove this funding problem.

Globalization of production makes it necessary to gain access to process control systems from remote locations. Modern companies are willing to off-shore their production but not so willing to off-shore their technical expertise. Remote monitoring systems allow technology companies to take advantage of the low costs of production in other countries (often with lower standards of legal and IP protection) without exposing their corporate expertise and trade secrets to those countries.

Remote access directly into a process control system is inherently risky. It requires openings in firewalls and exposure of the process control system to the Internet. Cloud systems hugely reduce this risk by separating the remote access server from the process control system. The process control system can operate inside a corporate firewall without any incoming ports open, while still being able to push data to the cloud. This connection can be made uni-directional to ensure that even if the cloud system is compromised, it cannot be used to make control changes on the plant system.

Cloud systems can improve efficiency. Managers, analysts, engineers and other specialists are able to examine the workings of the process in real-time. This gives them faster insight into the process, and the ability to work with and react to the true behaviour of the system. A cloud system, properly implemented, can provide data rate and latencies of milliseconds. This can be crucial to a remote engineer when trying to study high-speed transients and process dynamics.  Managers and analysts make better decisions when they have access to timely data. Maintenance personnel are able to reduce process downtime when they can observe changes to the process dynamics quickly, and can receive immediate feedback when process or equipment errors occur.

With this general understanding of the benefits of the cloud under our belts, for the next few weeks we’ll start to consider the unique requirements of a real-time cloud system. It can’t be quite like a traditional SCADA system, nor can it be exactly like a consumer-oriented or business cloud system. It will have to be something a little different.

Real-Time Data Flow in the Cloud

When we talk about putting real-time data into the cloud, what we mean is data flow in the cloud, or data communications. Most cloud applications today work on the premise of storing data in the cloud, and then accessing it at some later time. What we are interested in here is dynamic data, where a value can change 10 times or 100 or even 1,000 times per second, and be passed immediately along at pretty much that same rate. This is the kind of data flow that is commonly used in industrial processes, and which may have significant implications for cloud computing in general.

Paul Maritz, President & CEO, VMware touched on this in August in his keynote address on the future of cloud computing at VMWorld 2011. He said, “People are going to have to be able to react to information coming in, in real time. If you’re going to service the Facebook generation they way that they want to see information, you’re going to have to give them customized information in the context that they want to see it, in real time.”

Support for real-time communication has been evolving in the industrial sector over the past few decades. Control systems used to be considered “islands of automation”, and any data sharing between systems was done by jotting notes on a clipboard and making phone calls, or perhaps by copying data to a floppy disk, and carrying it to another machine over the “sneakernet”. With the advent of the LAN and Windows 3.1 in the 1990s, protocols like ArcNet, NetBIOS, and NetDDE were developed, but stability was a major issue.

Since then, a lot of thought and effort have gone into developing protocols for real-time communications for industrial data. Modern processes now benefit from more stable, routable protocols like TCP/IP and OPC for distributed processing. Today, machine operators can leave the control room when necessary, and walk through the plant, viewing their process data in real time on a hand-held computer. Managers are able to monitor production on the factory floor in real time, from their office, at home, or even on the road, using real-time data displays over proprietary networks.

Now people are starting to ask for this kind of reliable, high-speed data communication in the cloud. There are some real opportunities here. In addition to monitoring factory data and connecting machines, the cloud opens new possibilities. For example, data from embedded devices and remote sensors anywhere in the world could be collected from any location and sent to your laptop or phone in real time. Automobile navigation systems could become aware of the other cars on the road. The consumer applications envisioned by Paul Maritz will soon become reality.

Of course, there is the vision of data flow in the cloud, and then there is reality. Is all of this really doable? In the coming weeks and months, we will look at some of the practical aspects of how real-time data might be enabled to flow freely and securely through the cloud, and we’ll keep you up to date with the latest developments in the field. But before we do that, next week we’ll take a look at the specific benefits of cloud computing for users of real-time data.

Stepping into the Unknown

It seems like everybody is moving to the cloud these days.  Visionaries in the IT world see cloud computing as the next logical step in the evolution from mainframes and terminals, through networked PCs, to web-based applications, and now onward to the cloud.  They tout the advantages of lower costs and flexibility, estimating that by 2015 over half of computing solutions worldwide will be cloud-based.  Even now, everyone from pop stars and politicians on Twitter to grandmothers with Gmail to the titans of IBM, Microsoft, VMWare, and Amazon are getting into the act.

So what about industrial applications?  We hear the topic raised every now and then about the practicality of putting factory data in the cloud, mixed with a fair bit of skepticism.  Control engineers and managers responsible for the smooth operation of multi-million dollar production lines, power plants, or pipelines are justifiably cautious to embrace a technology that will move their data to some unspecified location, off in a “cloud” somewhere.  “What about security?” they ask.  “Who will have access to my system?”  “What if the network goes down?”

At the same time, there is a growing demand in plants and production systems for what a cloud-based system should be able to deliver.  More and more companies are operating in multiple locations–across nations, continents and oceans.  Managers need web-based access to their data for remote monitoring and in some cases, control.  Decision-makers and analysts in central offices need access to the most recent production-line data.  Expertise needs to be shared more quickly and cost-effectively than by loading a technician onto a plane, truck, or donkey to go out into the field.

However, industrial computing is different from most of IT.  Our security requirements are more stringent, our applications are typically linked to production machinery and embedded systems, and we often work with real-time data.  What does cloud computing look like in this environment?  Can real-time systems run in the cloud?  Is the cloud necessary, or even possible?

When we consider cloud computing for real-time data, we are stepping into the unknown, to some degree.  We are all learning here.  “Don’t think you have all the answers,” once quipped my business professor to a group of his eager-beaver undergraduates, “you don’t even know the questions yet.”

In that spirit, this blog will provide an opportunity to explore the questions, watch the developments, and evaluate solutions for one of the biggest challenges of our time: how to implement cloud computing using real-time data for industrial and embedded applications.