Submitted to: Guided by:
Prof. Isaac Jacob Prof. Vivek Rastogi
Submitted by:
Mayank Satkar (43)
PGDM-Retail
K. J. Somaiya Institute of Management Studies & Research
2011
TABLE OF CONTENTS
1. INTRODUCTION
How does it work?
2. RESEARCH OBJECTIVE
3. TYPES OF CLOUD
4. DRIVERS OF CLOUD COMPUTING
5. BENEFITS OF CLOUD COMPUTING
6. CHALLENGES IN CLOUD COMPUTING
7. IMPLICATIONS OF CLOUD COMPUTING IN THE BUSINESSES
8. IMPLICATIONS OF CLOUD COMPUTING IN RETAIL
9. CASELETS
10. CONCLUSION
11. REFERENCES
INTRODUCTION
Cloud computing refers to the provision of computational resources on demand via a network. Cloud computing can be compared to the supply of electricity and gas, or the provision of telephone, television and postal services. All of these services are presented to the users in a simple way that is easy to understand without the users needing to know how the services are provided. This simplified view is called an abstraction. Similarly, cloud computing offers computer application developers and users an abstract view of services that simplifies and ignores much of the details and inner workings.
Business applications are moving to the cloud. It’s not just a fad—the shift from traditional software models to the Internet has steadily gained momentum over the last 10 years. Looking ahead, the next decade of cloud computing promises new ways to collaborate everywhere, through mobile devices. Traditional business applications have always been very complicated and expensive. The amount and variety of hardware and software required to run them are daunting. You need a whole team of experts to install, configure, test, run, secure, and update them. When you multiply this effort across dozens or hundreds of apps, it’s easy to see why the biggest companies with the best IT departments aren’t getting the apps they need. Small and mid-sized businesses don’t stand a chance. With cloud computing, you eliminate those headaches because you’re not managing hardware and software—that’s the responsibility of an experienced vendor like salesforce.com. The shared infrastructure means it works like a utility: You only pay for what you need, upgrades are automatic, and scaling up or down is easy. Cloud-based apps can be up and running in days or weeks, and they cost less. With a cloud app, you just open a browser, log in, customize the app, and start using it. Businesses are running all kinds of apps in the cloud, like customer relationship management (CRM), HR, accounting, and much more.
Surfacing in late 2007, cloud computing is used to allow services used in everyday practice to be moved onto the Internet rather than stored on a local computer. Email has been available in both methods for quite some time, and is a very small example of cloud computing technology. With the use of services like Google's Gmail® and Yahoo Mail® on the rise, people no longer need to use Outlook or other desktop applications for their email. Viewing email in a browser makes it available anywhere there is an internet connection. In 2007, other services including word processing, spreadsheets, and presentations were moved into the cloud computing arena. Google provided a word processing, spreadsheet and presentation applications in its cloud computing environment and integrated them with Gmail® and Google Calendar®, providing a whole office environment on the web (or in the cloud). Microsoft and other companies are also experimenting with moving programs to the cloud to make them more affordable and more accessible to computer and Internet users.
How does it Works?
Let's say you're an executive at a large corporation. Your particular responsibilities include making sure that all of your employees have the right hardware and software they need to do their jobs. Buying computers for everyone isn't enough -- you also have to purchase software or software licenses to give employees the tools they require. Whenever you have a new hire, you have to buy more software or make sure your current software license allows another user. It's so stressful that you find it difficult to go to sleep on your huge pile of money every night. Soon, there may be an alternative for executives like you. Instead of installing a suite of software for each computer, you'd only have to load one application. That application would allow workers to log into a Web-based service which hosts all the programs the user would need for his or her job. Remote machines owned by another company would run everything from e-mail to word processing to complex data analysis programs. It's called cloud computing, and it could change the entire computer industry. In a cloud computing system, there's a significant workload shift. Local computers no longer have to do all the heavy lifting when it comes to running applications. The network of computers that make up the cloud handles them instead. Hardware and software demands on the user's side decrease. The only thing the user's computer needs to be able to run is the cloud computing systems interface software, which can be as simple as a Web browser, and the cloud's network takes care of the rest. There's a good chance you've already used some form of cloud computing. If you have an e-mail account with a Web-based e-mail service like Hotmail, Yahoo! Mail or Gmail, then you've had some experience with cloud computing. Instead of running an e-mail program on your computer, you log in to a Web e-mail account remotely. The software and storage for your account doesn't exist on your computer -- it's on the service's computer cloud.
RESEARCH OBJECTIVE
1) To study the feasibility of cloud computing in the Retail Sector.
2) To look at the prospects of the cloud computing in the coming years.
3) To look at the long term benefits in moving to the cloud for the retail companies.
4) To suggest the road ahead for retail companies on their IT spending.
TYPES OF CLOUDS
The Cloud Computing market is typically segmented into
1) Public clouds (services offered over the internet),
2) Private clouds (internal enterprise) and
3) Hybrid clouds (a mix of both).
The Public Cloud market is often sub-segmented into IAAS (Infrastructure as a Service), PAAS (Platform) and SAAS (Software).
a) Infrastructure-as-a-Service like Amazon Web Services provides virtual server instances and blocks of storage on demand. Cloud computing allows a company to pay for only as much capacity used, and jump start the business instantaneously. The capability provided to the consumer is to provision processing, storage, networks, and other fundamental computing resources where the consumer is able to deploy and run arbitrary software, which can include operating systems and applications. The consumer does not manage or control the underlying cloud infrastructure but has control over operating systems; storage, deployed applications, and possibly limited control of select networking components (e.g., host firewalls).
b) Platform-as-a-service in the cloud is defined as a set of software and product development tools hosted on the provider’s infrastructure. The capability provided to the consumer is to deploy onto the cloud infrastructure consumer-created or acquired applications created using programming languages and tools supported by the provider. The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, or storage, but has control over the deployed applications and possibly application hosting environment configurations.
c) In the software-as-a-service cloud model, the vendor supplies the hardware infrastructure, the software product and provides application support. Because service provider hosts both the application and the data, the customer is free to use the service from anywhere. The capability provided to the consumer is to use the provider’s applications running on a cloud infrastructure. The applications are accessible from various client devices through a thin client interface such as a web browser (e.g., web-based email). The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, storage, or even individual application capabilities, with the possible exception of limited user-specific application configuration settings.
Private cloud: The cloud infrastructure is operated solely for an organization. It may be managed by the organization or a third party and may exist on premise or off premise.
Community cloud: The cloud infrastructure is shared by several organizations and supports a specific community that has shared concerns (e.g., mission, security requirements, policy, and compliance considerations). It may be managed by the organizations or a third party and may exist on premise or off premise.
Public cloud: The cloud infrastructure is made available to the general public or a large industry group and is owned by an organization selling cloud services.
Hybrid cloud: The cloud infrastructure is a composition of two or more clouds (private, community, or public) that remain unique entities but are bound together by standardized or proprietary technology that enables data and application portability (e.g., cloud bursting for load-balancing between clouds).
1) 75% of IT budgets are spent maintaining and running existing systems
2) The initial purchase cost of software is only 5% of the TCO
3) Hidden personnel costs can be as high as 70% the cost of on-premise software
4) IT labor costs can be 18 times that of equipment cost
DRIVERS OF CLOUD COMPUTING
BENEFITS IN CLOUD COMPUTING
1) Pay per use- The vendor owns the technology (Software Company) and the client can pay as per their usage requirements.
2) Instant availability- Health care industry is highly regulatory bound and tighter deadlines are to be met. Most of the changes in their IT set up can be met with instant availability of their requirements.
3) Scalability- With increasing citizens coming under the Health Insurance coverage because of the impact of the US Health Reform Bill, the number of customers for Health insurance companies is bound to increase. Cloud computing ensures that scalability of the IT infrastructure to handle more data and complex data can be done with ease.
4) Hardware abstraction- Clients need not worry about maintaining their IT hardware systems as they do not own them anymore.
5) Cloud computing not only reduces business costs, but also makes applications accessible from any location, and reacts swiftly to changes in business needs
6) Cloud computing is often described as “converting capital expenses to operating expenses” (CapEx to OpEx). The phrase “pay as you go” more directly captures the economic benefit to the buyer
7) Reduced need for advanced hardware
8) Companywide access
9) Metered fees
10) Removes need for physical space
11) Streamlined Hardware
12) Grid Computing
13) Improved Service delivery
14) Enabled Business Innovation
LIMITATIONS OF CLOUD COMPUTING
Asanytechnologyis aboonforanevaluationasthehistoryis evidence,thereare disadvantagestoowhichcannotbeignored.Despiteafactcloudcomputinghas somanyfeatureswhichcanbeawaiting anewhorizontherearealsokeyfactors whichcannotbe ignored. Few have been summedupbelow:
1) Lackofconnectivity causes100%downtime,whereaswith traditional applications,lackofconnectivity allowsforsomelocalfunctiontocontinue untilconnectivityisrestored.
2) The lackofindustry-widestandardsmeansthatausage surgecaneasily overwhelm capacity without the ability to push that usage to another provider.
3) Companiesprovidingcomputingserviceswill over-selltheseservicessimilar to howbandwidthis over-soldbasedonaverageor"peak"usage,insteadof "maximum"usage.ISP'stypicallyop