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Cloud computing, remote work, digital transformation, and startups. These are precisely the things I’m going to be talking about in this article. No bolt of lightning struck me with this idea, just a talk I had the pleasure to listen to one beautiful Monday while drinking my morning coffee. You can find it here. Mat Gren, Head of Business at Scalac, in a comprehensive conversation with Pawel Gieniec, CEO at Cloud Admin (Scalac’s client for almost three years) on the technological shift that has accelerated enormously from February 2020, when COVID-19 turned the world upside down. 

So let me fill you in with the context of their discussion and take the conversation a few steps further. Let’s dive in!

What you need to know about cloud computing

Before we start, let’s first cover the basics. 

On-premise vs. Cloud

The difference between Cloud computing and on-premises software is quite significant. A company can either host everything in-house in an on-premise environment, or in a cloud environment, with a third-party provider hosting everything for you. However, you can also rent a colocation service in a company and still be on-premise. In the cloud you do not need to manage physical machines, the provider gives you the ability to operate on them (e.g. by setting up a virtual machine). After all, the important thing with Cloud is scalability on demand. You just say “I want X more machines”  and they give you X more machines. You don’t have to worry about the availability of resources.

Private Cloud vs. Public Cloud 

Nowadays, most enterprises adopt cloud computing to store their data and run applications without building and maintaining any further on-premise IT infrastructure. Enterprises have different options for implementing cloud computing. The cloud computing implementation models can be divided into two broad categories — public cloud and private cloud (actually there are two more types: hybrid and community cloud, but in this article, I will be focusing on the first two). An enterprise can opt for a private cloud to utilize computing resources exclusively through dedicated hardware, software, and network. Private cloud is primarily a solution for regulated sectors like finances, where all possibilities of access by unauthorized users must be eliminated

On the other hand, the enterprise will have to share computing resources with other subscribers if it opts for the public cloud. The public cloud service provider will make hardware, software, and support infrastructure available to the business. But the company will have to share it with others. That’s why it’s crucial that enterprises well understand the differences between a private cloud and a public cloud.

Case Study: Building a Successful Business on the Public Cloud

Pawel Gieniec used to work at Zynga as a Principal Software engineer and the CTO of Draw Something Franchise. Zynga was the first and the fastest company to prove that you could build a successful business on top of a public cloud. They were 80% of AWS back in 2010-2011, to the point that Amazon refused to sell them any more servers because it tapped Amazon out.

Zynga is a great example that you can build a successful company on top of a cloud. “I think it was CityVille where we launched and within one month went from a few thousand people playing into a hundred million people. So that is what I mean by rocket ship”. So how does the cloud work in cases like this one? The cloud might not always be the only solution, but it gives a lot of flexibility. You can scale it right away and go from a few thousand users playing a game to 100 million in 30 days. In Zynga’s case, it was all on AWS, consistently ranked first among cloud infrastructure services. 

What do cloud computing, remote work, and digital transformation have in common? 

Digital Transformation – relying on cloud infrastructures – is the new normal

According to Pawel, at the beginning of the COVID-19, the public cloud represented three percent of the IT industry. Ninety-seven percent were either on-premises data centers or private clouds. In December 2019, Andy Jesse, the CEO of AWS, announced officially that AWS was getting into the data center market with AWS outputs. There are sometimes reasons why companies can’t leverage the public cloud, so now Amazon can ship you servers to install into your data centers for you to leverage AWS services. 

However, when COVID-19 shook the world, the internet was hitting a record level of traffic. This accelerated people’s adoption of either moving out into companies dedicated to managing data centers or into the public cloud.  But at the same time, people realized that relying on on-premise data centers had a problem; they couldn’t buy masks. Why? Because the servers were not ready to handle this amount of traffic and scalability, especially quick one is definitely not the strongest point of on-premise services. There were problems with buying the right chemicals to disinfect data centers if somebody got sick.

In general, the data centers weren’t designed to handle a global pandemic. When companies built them, they thought only about natural disasters such as floods, earthquakes, tornadoes. To avoid those dangers, they spread their servers across the country or countries. However, a global pandemic was something they hadn’t anticipated. In this situation, it turned out to be the very opposite of a cost-effective way to manage your data.  

Cloud computing and the future of remote work

Implementing cloud computing within an IT infrastructure makes it easier to enjoy the benefits of remote work. On-premise systems often require complicated security profiles for data to be accessed by a third party. With cloud-based data hosted externally, it is easier to give access to a third party user. This makes remote work, and any kind of outsourcing easier. 

Some cloud services that you’re definitely familiar with are Google Drive or Dropbox. These are examples of cloud storage spaces for data synchronization – files that are stored in these systems are available to the account owner from any device connected to the Internet. And you can easily share them with others. 

Employees can access documents and data that they need by using dedicated credentials (to maintain security) while still giving them the flexibility of working from wherever they want. This can be especially useful when you have multiple office locations. But what’s most relevant is that cloud computing is great for scalability and growing your businesses. You can quickly scale up or down without losing the money you otherwise would have invested in hardware or software. This is also ideal when you have a restricted physical office space. We believe that the size of your office should not determine the size of your projects.

CD vs Spotify – The future is now

The thing with cloud computing could be compared to keeping media locally on hardware such as CDs. Most of us do not listen to music on them that often anymore or do not use CDs at all. We turn on platforms such as Spotify where the resources – songs – are in the cloud, without any influence on our local, limited memory in smartphones. We also watch Netflix – without the need to carry flash drives with movies or buying additional equipment other than the computer we use for all the other things.

Finally, there’s software. No more Microsoft Office or Adobe installed locally for most of the private users. Also, very popular and trending in the small and mid-sized companies. The software subscription payment model is the most popular one these days as it lowers the cost of the software and enables frequent updates without the need to buy and install new versions. 

Remote work – from Blockchain to COVID-19

Around the world, more people than ever are working remotely. While the COVID-19 pandemic has triggered a massive migration away from the traditional workplace, the evolution of remote work began way before it. All the way from the world’s first offices to the social and technological shifts that have spawned a remote revolution. 

A short history of remote working :

  • The first personal computers hit the scene in 1975.
  • In 1979 IBM allowed five of its employees to work from home as an experiment. 
  • By 1983, roughly 2,000 IBM employees worked remotely. 
  • Also, in 1983, the internet was born. According to Flexjobs, between 2014 and 2018, the number of fully-remote US companies jumped from 26 to 170. 

Blockchain

In the meantime, in 2009, Nakamoto implemented Blockchain technology as a core component of bitcoin, the first-ever cryptocurrency. According to Pawel Gieniec, this might have had a significant impact on remote work, or rather on the media image of remote work.

I think that one of the things that have probably made a significant impact is blockchain. With teams that are building any kind of technology on top of a blockchain, they’re just naturally distributed, and I think that mentality of ‘hey you need to have you know an office or like multiple offices right where people can come in and talk’ – it’s no longer there.

Pawel Gieniec, Cloud Admin

COVID-19

What Blockchain started in the remote work department, COVID-19 has taken to the next level. But as you can see, it has only sped up a process that was already happening. Nevertheless, some people are still skeptical about remote work, especially when working with a remote team extension. In reality, these are more myths than real fears that business leaders have. For example, the myth of startups that are afraid their company culture will suffer. 

I think the startup mindset there’s a lot of you know people that hire friends of friends to help them out with one task or help them build some MVP, so I don’t think that’s any different you know whether you utilize an external company or some friend network.

Pawel Gieniec, Cloud Admin

Does every cloud have a silver lining?

While Cloud computing is not the answer to every problem, it still has a lot to offer. Sometimes people get the wrong idea of its capabilities, whereas the main obstacle often lies in strategy rather than in the cloud itself. 

According to Gartner, most leaders, when asked about their cloud strategy, admit that they don’t have any formal cloud strategy or that their plans are mostly focused on adoption/migration and implementation.

A cloud strategy is critical for every organization, regardless of where it is in its cloud journey. Moving to the cloud without a cloud strategy results in ad hoc adoption patterns, higher costs, disjointed management, security vulnerabilities, and overall dissatisfaction with cloud outcomes. Whereas a solid cloud strategy can reveal what unfulfilled potential may lie on the horizon for an organization, on top of all the technical benefits.

So if you’re thinking about investing in Cloud Solutions, get in touch with Scalac today. We can help you decide whether it’s the right solution for you. One that can match your needs and help you develop a comprehensive strategy that will cover your short-term and long-term goals. 

Stay competitive thanks to the digital transformation. 

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