Tag Archives: cloud

Turning a Software Product Company Into a Cloud Company

From 2011 to 2015 Software as a Service (SaaS) adoption in enterprises grew fivefold from 13% to 74%. The trend still continues with public cloud services worldwide growing by 18% in 2017. With this growth, the pressure to become a cloud company in order to remain competitive is increasing.

We at WSO2 have already gone through the transition and in this blog I would like to share a few experiences and give you some pointers on becoming a cloud company. This will help you to go from being an on-premise business to adopting a cloud and as-a-service model. First, let’s explore why you need to make the move. Being a cloud company brings many benefits for both you and your customers.

Here are some of the customer benefits that we identified:

  • Customers don’t have to pay a lot of money upfront, so the cost of entry becomes low.
  • With the pay-as-you-go model customers don’t invest a lot of money unnecessarily.
  • Everything is already set up by the vendors so customers can go-to-market faster.
  • Customers don’t need to maintain infrastructure and can now outsource their operations including uptime, upgrades, and security.
  • Most cloud vendors care about having APIs and integration points so customers can typically integrate their system with other solutions.
  • Customers can easily scale up or down as required.
  • Web user interfaces are mainly used so they can work from anywhere.
  • Since these are shared deployments customers have an entire community around them that will help find bugs and fixes before they even notice them.

Also, there are quite a few vendor benefits that you can reap:

  • Its cost-effective delivery model lets you address new markets with lower expenses.
  • By enabling a self-service model for your customers you can cater to lower levels of the market as well as to larger geographies.
  • You receive faster feedback on your products because customers will notice any faults and let you know immediately.
  • There is less shelfware because people start using your products much faster and the chances of them buying a license and not using the product at all are low.
  • Because of this you gain recurring revenue and adopting a subscription model rather than a booking model allows you to predict next month’s revenue much better.

Now that you know why you should become a cloud company, ask yourself how this would affect your organization. Moving to an as-a-service model affects every single part of your organization including research and development, operations, security, sales, presales, support, and finance among others.

Research and Development (R&D)

In the waterfall model teams typically work on one big release every year or so and follow that up with a wave of upgrades for enterprise customers. The iterative cloud-first model is much faster. For example, if a product manager identifies a new market segment your team will be able to easily get the new features out in weeks or even days. The feedback they receive will also be faster since people will start using the features as soon as it’s released. This can be a very gratifying experience for developers but if something doesn’t work, they can’t make excuses and blame the customer for not configuring it correctly.

This also impacts testing, upgrading, and troubleshooting. Testing is key. There is lower tolerance if something is not working because it affects everyone using it, not just the client who happens to deploy it first. You need to pay a lot more attention to automated tests, acceptance tests, staging environments and more. Since it’s a shared deployment, teams get access to shared files, environments and servers that allow you to troubleshoot and fix issues faster.

You need to make sure your products are ready for the cloud before you launch them. They need to be able to scale for growing numbers of customers. When I first joined the company, the products were able to run in multi-tenant mode, but when we scaled for thousands of customers we started having issues which we needed to fix.

Usability is another aspect that customers have high expectations for. Cloud users expect a seamless experience that makes it easy for them to understand, configure and use the products themselves.

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Operations

In typical software companies, the extent of operations includes an internal information services team that maintains emails, WiFi, etc. Apart from this they provide a team that goes to customer sites, when the need is required, to help them deploy and fix things.

When you become a cloud business, operations become a key factor. You need to have a team that is dedicated to updating, installing and monitoring your services to make sure they are up and running all the time. Your need to hire or grow a team with a different mentality from traditional development. Pick some engineers who may be in development but have the ops way of thinking. On one hand, it’s very gratifying to know that the systems are up and running and the customers are happy because of you. On the other hand, it’s very different from normal development work where you just write the code and people use it. It’s also a 24/7 role because we now live in an era of globalization where either your customers or your customer’s customers have clients all over the world.

Cloud also increases the visibility of failures. Your customers will quickly notice if something is wrong so you need to introduce new processes for security, postmortems, shifts, and rotation models and implement an alerting system that lets your customers know if something is broken. Monitoring is also key so that you get early warnings and end up preventing a fire rather than putting it out.

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Transparency

That’s why you need transparency. When we first launched our cloud we were not very transparent. When things went wrong, we worked on fixing them but a lot of the times customers would be confused as to whether it’s something they’re doing wrong or if it’s something wrong with the service. We have implemented an uptime dashboard so that all our paying customers can check whether the services are up or down. We have also implemented a notification system that sends an email alert to customers when there is an outage and again when the problem is fixed. They also receive postmortem reports for further insight. When our formal SLAs with uptime guarantees are not met we give our customers credit.

The most important thing is to communicate. Cloud is a services business so you need to be very transparent and let your customers know what’s happening. They need to trust in you and your service, understand how the system works and know exactly what they are getting from it.

Security

Culturally in most industries today, cloud and SaaS is accepted. But security is a key factor for a lot of customers when choosing a cloud vendor. There are compliance factors that need to be in place. For example, if you have payments in the cloud then PCI compliance is a must. You need to conduct audits, have an internal security team and use external security services. You need to use encryption where ever you can.

In general, make sure you document all your procedures. Document the way you work with your software, run the server, etc. We ourselves have a fairly long security processes document that we share with all our customers, which validates to them that we treat security as an extremely important factor.

Source: http://www.zdnet.com/article/industry-cloud-research-security-and-data-protection-is-still-the-most-important-feature-for/

Sales

Currently, you have an existing sales team and existing products that you sell. When cloud comes into the picture, it will have an impact on your sales. You need to consider a few factors with regards to this:

  • Decide whether to let your team sell both the enterprise and cloud products or the enterprise product first and then the cloud as a service.
  • Decide on what the pricing levels should be if your service needs to address lower tiers of the market.
  • Figure out how to protect your larger enterprise sales from being cannibalized.
  • Make sure you offset the old revenue with your new revenue.
  • Give a clear message to your current and future customers to decrease the confusion caused by introducing these new services.
  • Distinguish between the customers who can take advantage of self-service and those who will need more help.

At WSO2, we try to align our pricing for cloud so that even people with lower budgets can use it. Our sales team actively promotes our cloud services to those customers that fit the model best. We get a smaller revenue from these customers but at the same time, we don’t spend as much time and effort to enroll them and customize their solution because of the self-service feature. It’s a win-win because our account managers can focus more on our bigger customers who need more assistance.

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Pricing

You will have to experiment with pricing. We’ve been doing the same. There are three main pricing model: freemium, trial and commercial. Some vendors will offer their solutions for free at certain tiers. In our case, we have a free trial because we found that optimal for the nature of our solutions. Overall, try to make the pricing predictable and easy to understand for your customers. Charge in terms that make sense to your customer rather than based on the resources you spend, but also do your math and make sure you don’t lose money.

Presales and services

How do you go about hand-holding? Is it okay for customers to work in a self-service mode and understand how to use everything on their own, or do they still need help with customizations? You need to be able to distinguish between smaller issues that customers can deal with on their own and bigger projects like customization.

Then, you need to figure out how to serve customers across geographies. What can you automate and what requires human presence? For example, you can embed some tutorials and run automated nurturing campaigns during the trial period so that they can easily understand how to use the service efficiently. You also need to have a way for your customers to request for help, either through a ticket-based model where customer ask for help as and when they need it or on a project-based model where for example, you work with them to create a proof-of-concept.

Support

You need to create a support model that works for you. Will you give a certain amount of community support through user forums? Would you prefer ticket-based support? Will the product team handle support or will you have a dedicated team? These are the questions you’ll need to ask yourself. At WSO2 we have a rotation model for support. The engineers who actually work on the products work in the support team on rotation, so they know exactly what the customers want, what issues they might be facing and how to quickly solve them.

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Finance

Typically for enterprise software, finances are calculated from a bookings perspective. You record it as soon as you get the deal. Cloud follows a subscription model with recurring revenue. With bookings, you can’t really predict the actual amount of revenue you will get. Looking at your monthly recurring revenue (MRR) is a good way of predicting next month’s revenue and how much you are growing.

Average revenue per customer (ARPC) is another important factor to consider. When you grow that figure, it means that you are getting more money from the richer customers, so you can spend more money to attract new customers.

The churn rate is also very important. The lower your churn rate (meaning the customers are happy and stay with you longer) and higher the average revenue per customer – the higher your lifetime value (LTV) from a customer is. If your LTV is higher than your customer acquisition cost (CAC), then you can spend more money on acquiring customers and make more money from them.

Becoming a cloud company has a cultural impact throughout your organization. The factors we talked about previously are all departments and teams in your company. They need to change the way they think and do their work. You can either go into this by creating smaller teams that follow the new model and work beside those that follow the older model and incrementally shifting to an as-a-service model or with a big bang where all your teams are transitioned to the new model at once. I would recommend you to start with some projects and dedicated teams, show their success and expand the team. This way you don’t disrupt any of the existing products and teams but coexist during this transition.

I hope this blog has helped you understand what it takes to moe to the new cloud and as-a-service model. For more information you can watch my webinar on this topic. Good luck!

Motorola Mobility: Using WSO2 Integration Platform to Increase Business Agility

Companies all over the globe are realizing the power of lean technology on the cloud and Motorola Mobility is one of them that’s taking action towards wielding this power. In February 2017, Sri Harsha Pulleti, an integration architect at Motorola Mobility and Richard Striedl, an advisory IT architect at Motorola Mobility, spoke at WSO2Con USA 2017 about their move to a hybrid cloud and container architecture with zero-touch automation.

A few years ago, on the day after thanksgiving, Motorola’s website crashed, resulting in the loss of many transactions from buyers who were flooding in to get their discounts. That’s when they started questioning how it happened, why it happened, and what they could do about it, explained Sri. All their web services were running through heavy-weight enterprise service buses (ESBs) in their data centers that didn’t have any other technical capability. They needed to move away from this to a lightweight platform in the cloud.

After evaluating many vendors they found WSO2 and its lightweight ESB – just what they had been looking for. Sri explained that they could quickly spin up instances of it and even set auto-healing and auto-scaling capabilities. WSO2 ESB (now extended as WSO2 Enterprise Integrator, which includes all the other key products and technologies from the WSO2 Integration Platform) also supports Amazon Web Services (AWS), which was their first option for cloud computing services. After choosing their vendor, Motorola began to make the necessary changes in their environment by re-architecting the system, setting up multiple ESBs and moving to a micro-platform architecture.

A year later, thanksgiving came along and this time everything went smoothly. “It was perfect, there were no issues and everything was absolutely fine”, explained Sri. However, a few months later, they realized that this was costly. Sri was given the challenge of finding something with the same capabilities as AWS, but at a lower cost. That’s when they started looking at OpenStack: an open source software for creating private and public clouds. It created an environment with similar capabilities to AWS and allowed them to set up their own data centers. After discussing further, they decided to run both environments (AWS and OpenStack) parallely and scale them up or down as needed.

This time, they decided to use containers, which allowed them to package their software into standardized units for development, shipment and deployment. But why? It’s lightweight, flexible and easy to scale. Sri then went on to discuss the importance of emphasizing collaboration and communication between developers as well as IT through DevOps: “It’s something everybody wants to achieve”. Instead of having just a DevOps team to achieve this, they made a zero touch automation DevOps platform. This homegrown application called Debug 360 built on open source products allows their developers to focus on developing the code and checking it into a repository while the end-to-end automation takes care of the rest. It now takes less than a week to complete any new development in an integration model.

Motorola now has WSO2 ESB on AWS and OpenStack, one without containers and one with. The next step will be to integrate these instances to achieve their ultimate goal of spinning up instances in both environments, Sri noted.

Motorola Mobility Advisory IT Architect Richard Striedl further explained the concept of cloud elasticity. He stated that they have learnt a lot especially in terms of enhancing DevOps while working with WSO2 the last few of years. The requirements for cloud elasticity included having the same DevOps procedures, cloud capabilities and application code and auto-scaling.

“We’re evaluating WSO2 API Manager,” said Richard while explaining their need for APIs to manage the environment, build the framework and have more control over it. At present, they have 35 applications with 90% of traffic going through OpenStack and 10% going through AWS. Richard concluded by exploring their future plans of dockerizing with data services and message brokering capabilities available in the new WSO2 Enterprise Integrator. “We might even take that step towards Ballerina as we all learned today,” he added.

To learn more about how Motorola Mobility is moving to the cloud through zero touch automation listen to Sri’s and Richard’s talk at WSO2Con USA 2017.

WSO2Con Insights–Trimble Builds an Enterprise PaaS Framework with Open Source

A large part of the value of Trimble solutions is that they enable customers to build and manage their own positioning-centric solutions for employees in the field—a key requirement for customers in the agriculture, construction, and transportation sectors. Trimble also needs this capability in-house, since its various divisions are set up to be entrepreneurial and have the speed and agility to execute. As Prakash Iyer, Trimble’s vice president for software architecture and strategy, explained during his session at WSO2Con 2013 US, building an enterprise platform as a service (PaaS) framework with open source solutions helped Trimble meet these goals.

The Move to a Cloud Platform

When Trimble first considered building a flexible development platform, the question was whether to go with a traditional platform versus a product-driven platform, Iyer recalled. With a traditional platform, by the time the hard work is done, the technology is likely to have changed, he noted. The better solution, the Trimble team realized, was a product-driven platform where selection of the platform elements is driven by the product. Users can then build applications on the platform and deliver them efficiently.

PrakashIyer1The Trimble Platform as a Service, known as TPaaS, provides the core services needed to build any modern enterprise application, and also provides an architectural framework to build loosely coupled SOA applications, Iyer explained. Providing a foundation for TPaaS are four multi-tenant, cloud-enabled WSO2 Carbon products: WSO2 Enterprise Service Bus, WSO2 API Manager, WSO2 Application Server, and WSO2 Identity Server.

“Our first implementation of TPaaS had Identity Server, App Server, API Manager and ESB. We didn’t use the whole stack but then we incrementally added to it,” Iyer noted. “We’re able to then build an app on that platform and then deliver it to the team, and prove it can be done efficiently. And that creates momentum.”

TPaaS Supports Internal and External Users

Iyer explained that Trimble’s development platform includes deployment infrastructure and managed hosting services, all of which help reduce the cost, time, and complexity of application development.

A key advantage of TPaaS is that it is accessible to Trimble’s network of partners and dealers, who often need to use the system to exchange data and flow transactions through it, Iyer said. It can be offered as a service framework to these partners and dealers to host their applications. He noted that the platform also provides a cloud container that can host any Trimble service, and act as a gateway to share any Trimble service for wider reuse.

The Benefits of Open Source

While the cost savings of open source were attractive, Iyer stated that other aspects of an open source licensing model were important.

“We can take WSO2 and customize it. If we don’t find everything we need, we can PrakashIyer3 customize it. We don’t have to take everything, just the part needed for us,” Iyer observed. “The other advantage is portability and ownership. I want to take my PaaS across multiple infrastructures and services; some divisions may want to deploy in Rackspace, some in Amazon, or even internally.”

Additionally, since technology changes so quickly, using WSO2 open source products allows  Trimble to avoid costly investments in solutions that will become out of date, or can’t be customized. Finally, there was the issue of focus. Iyer recalled that Trimble needed to build a solution, and using open source would allow the team to focus on those areas where Trimble could differentiate.

“My goal was always to eventually have everything from writing the code to deployment; things we could assemble and put together our own platform, and then we can focus on the applications,” Iyer said. “That was the strategic alignment part we shared with WSO2.”

For more information about Trimble’s development of an enterprise PaaS framework, view Iyer’s WSO2Con 2013 presentation.

WSO2Con-US-2013--Building-an-Enterprise-PaaS-framework-using-Open-Source-Components

WSO2Con Insights – How Boeing Transformed Commercial Aviation Using WSO2

Keeping airplanes in the air and operating safely and efficiently is the job of Boeing’s commercial aviation division—specifically, the service known as Boeing Edge, which provides support and service to the manufacturer’s aviation customer base.

As Boeing senior product manager Jim Crabbe explained at WSO2Con US 2013, providing this level of agile, informed service, and allowing customers to share information among many disparate systems, brought about the need for platform as a service (PaaS), which is powered by WSO2 software.

“Our Boeing Edge solutions need to help customers’ planes spend less time on the ground, and more time in the air,” Crabbe said. “For airlines, time is of the essence, and creating operational efficiency requires connecting people, processes, and sources of data.”

Boeing’s job, Crabbe explained, is to reduce the complexity of these mission-critical processes. “Some airlines are running very old applications and systems, but they work and they’re solid,” Crabbe said. “The cost of moving those systems to a new state is large, and could disrupt their operation.

That’s where Boeing has taken on these challenges to help our customers—how to break free from their data, and how to integrate better with the applications and products we provide to them, to create business process-driven workflows and new applications.”

Boeing chose the entire stack of WSO2 solutions for its PaaS—including WSO2 Private PaaS and WSO2 Carbon multi-tenant enterprise middleware products—because of WSO2’s reputation, and its commitment to open source.

“Our development direction has always been a service-oriented architecture, so we use open-source modular solutions whenever possible,” Crabbe said. “We like to leverage emerging technologies and try to stay vendor-agnostic because our customer ecosystem uses a wide variety of tools and software. That’s where working with WSO2 has been so advantageous.”

By using WSO2 solutions to build its PaaS solution, Crabbe observed that Boeing has been able to leverage the advantages of the cloud, such as elasticity and scalability, helping the company to deliver services in a consistent manner. “For example,” Crabbe said, “We can tie in line mechanics with maintenance systems, and allow users to upload pictures and other documentation, and integrate it with the back-office system of the airline.” Jim Crabbe

Deploying a flexible PaaS built on WSO2’s modular solutions helps Boeing maintain the agility it needs to support its customers, Crabbe noted: “We need to be able to continue to innovate, and we can’t be afraid to try something new.”

Another way Boeing provides value, Crabbe told attendees, is with data governance. “That means the right data to the right person for the problem at hand,” Crabbe told attendees. “You have to put your data governance process in place and protect your API, but enable people to do the work they need to do.”

For more information about Boeing’s use of WSO2’s platform, view Crabbe’s WSO2Con US 2013 presentation.

Lets talk business agility for your next generation enterprise

We are happy to announce that WSO2 is a Prime Time Sponsor at GigaOm Structure 2013, taking place in San Francisco next month.  The 2-day conference explores how real-time business needs are shaping IT architectures. gigaom-logo

I will be there to present a workshop on Achieving business agility with cloud APIs, cloud-aware apps, and cloud DevOps PaaS. You can also meet the team and get a preview of  new developments in our cloud PaaS and DevOps offerings, at the WSO2 booth.

Recently I’ve been talking a lot about business agility. With today’s “Now Generation”, business stakeholders, who drive revenue growth and customer retention, desire to rapidly seize opportunity and market share.  They often view IT timeframes and capabilities as a poor match for today’s fast business-pace. My webinar last week with David Linthicum addressed some of these concerns. We talked about

  • A path towards agile IT through the use of new approaches and emerging technology
  • New concepts around DevOps improvement
  • The use of emerging PaaS technology
  • Agility best practices that will guide you to success

If you missed out, the slides and recording are avaialble here: http://wso2.org/library/webinars/2013/05/accelerate-business-agility-paas

If you are in the area, I would be more than happy to talk about how we can help, at Structure 2013.

– Chris Haddad is VP of Technology Evangelism at WSO2. He blogs at http://blog.cobia.net/cobiacomm/

WSO2 Cloud Summer School kicks off this week

Here’s a great way to start your Summer. Since 2009, the popular WSO2 Summer School program has helped enterprise IT architects and developers become more familiar with service-oriented architecture (SOA) technologies and best practices. The all-new classes for 2012 will focus on the cloud: from selecting a cloud platform to developing cloud applications, scaling cloud deployments, and demonstrating cloud value.

We start off with a session on Selecting a Cloud Application Platform on June 12th followed by

Watch this video by lead presenter Chris Haddad, who brings more than a decade of expertise in cloud and platform-as-a-service (PaaS), on what you can expect to learn.

Hasmin AbdulCader,
Director, Communications http://www.twitter.com/hasmina