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Question: 235
You have configured an SR-IOV interface on a virtual host machine in your Contrail network environment. You
discover that analytics data is not being recorded for traffic to the customers VM that uses the SR-IOV interface.
Which two statements are true in this scenario? (Choose two.)
A. You cannot perform analytics on the SR-IOV interface traffic.
B. The SR-IOV interface must be re-added to the analytics engine.
C. The data of packets going to the VM does not go through the vRouter on the host.
D. You must use the tap interface on the Contrail vRouter to collect SR-IOV analytics data.
Answer: A,D
Question: 236
What are two Keystone endpoint types? (Choose two.)
A. root
B. admin
C. rbac
D. public
Answer: A,B,D
Explanation:
https://linuxacademy.com/blog/linux/understanding-keystone-endpoints/
Question: 237
What is the role of an orchestration platform in a cloud networking environment?
A. It controls and monitors the network underlay infrastructure.
B. It controls pools of compute, storage, and networking resources.
C. In configures and monitors tunnels between physical hosts.
D. It configures and monitors tunnels between virtual hosts.
Answer: B
Question: 238
Refer to the exhibit.
$13$10
You have a Contrail providing cloud services to Customer A. Customer A wants to add a packet capture service to
their network to analyze traffic flowing to and from the Internet.
Referring to the exhibit, which statement is true?
A. The packet sniffing service must be performed on the edge routers facing the Internet.
B. The packet sniffing service must be enabled on the vRouter directly attached to the customers V
C. The packet sniffing service can be implemented on any physical host in the cloud environment.
D. The packet sniffing service can be implemented on any switch within the underlay fabric.
Answer: B
Question: 239
Which two OpenStack projects contain networking components? (Choose two.)
A. Keystone
B. Magnum
C. Nova
D. Neutron
Answer: A,B,D
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Question: 240
Which statement is true regarding Virtual Network Functions (VNF)?
A. A VNF is implemented with virtual platforms.
B. A VNF requires an SDN controller for implementation.
C. A VNF is implemented with physical hardware platforms.
D. A VNF requires an SDN orchestrator for implementation.
Answer: A
Question: 241
You are required to implement a Contrail service that will automatically increase network resources for that service
when under high traffic loads, and reduce network resources for that service under low traffic loads.
Which configuration steps will accomplish this task?
A. Configure Heat to monitor the CPU threshold of services VMs, and configure a Heat auto-scaling policy to adjust
the VM resources allocated to the service.
B. Configure Ceilometer to monitor the CPU threshold of services VMs, and configure a Ceilometer auto-scaling
policy to adjust the VM resources allocated to the service.
C. Configure Heat to monitor the CPU threshold of services VMs, and configure a Ceilometer auto-scaling policy to
adjust the VM resources based on alarms generated by Heat.
D. Configure Ceilometer to monitor the CPU threshold of services VMs, and configure a Heat auto-scaling policy to
adjust VM resources based on the alarms generated by Ceilometer
Answer: D
Question: 242
You want to deploy an application to the cloud so that the application instances can be dynamically mirrored. You
want to manage only the application, leaving all other management to the cloud provider.
Which type of cloud service should you choose in this situation?
A. IaaS
B. PaaS
C. DBaaS
D. SaaS
Answer: B
Question: 243
Refer to the exhibit.
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Referring to the exhibit, what does the IP address 10.1.1.2 refer to in the api_server.conf file in Contrail?
A. The physical server IP address
B. The OpenStack controller IP address
C. The Server Web UI IP address
$13$10
D. The Contrail IP address
Answer: B
Question: 244
You have deployed a load-balancing service for a customer in your Contrail cloud networking environment for their
data cache system. Due to the network capacity requirements, the caching servers must be migrated to a different rack
of equipment within the data center.
Which two statements are true in this scenario? (Choose two.)
A. A new load-balancing service will be provisioned by the orchestrator prior to moving the caching servers.
B. The orchestration platform can remap the traffic through the existing load-balancing service once the caching
servers are moved.
C. The load-balancing service must be decommissioned and re-provisioned once the caching servers are moved.
D. The load-balancing service can be migrated to the vRouters where the caching servers are located.
Answer: A,B,D
Question: 245
You are implementing an OpenStack environment and need to install the Glance service on the control node.
Which two actions must take place to successfully complete this action? (Choose two.)
A. Create the API endpoints in Keystone.
B. Create a new availability zone for Glance.
C. Create the Glance service credentials.
D. Create local storage capacity for Glance images.
Answer: A,C
Explanation:
https://docs.openstack.org/mitaka/install-guide-ubuntu/glance-install.html
Question: 246
You are using OpenStack as the orchestrator for your data center. You need to instantiate several instances of a
webserver. There is a requirement that each webserver VM must have six VCPUs and 32 GB of RAM.
Where in OpenStacks Web user interface would you set up these resources?
A. Project>Compute>Instances
B. Orchestration>Stacks
C. Project>Compute>Images
D. Admin>System>Flavors
Answer: D
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Explanation:
https://docs.openstack.org/horizon/latest/admin/manage-flavors.html
Question: 247
You are asked to create a Contrail service instance between two virtual networks. The left virtual network is a private
virtual network. The routes from the left virtual network VRF should not be leaked into the right virtual network VRF.
Which Contrail service instance type would you choose in this scenario?
A. In-network private
B. In-network NAT
C. In-Network
D. Transparent
Answer: B
Question: 248
Refer to the exhibit.
Virtual machine VM-1 is spawned on a compute node Compute-1. VM-1 is not able to ping PC-1, which is located
outside of the SDN cloud. You want to run packet captures to trace the packet initiated by VM-1 towards PC-1.
Referring to the exhibit, which three interfaces would you use to accomplish this task? (Choose three.)
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A. The SDN-GW interface facing the SDN cloud
B. The Control-1 data interface
C. The Compute-1 data interface
D. The VM-1 tap interface
E. The Compute-2 data interface
Answer: A,C,D
Question: 249
What is needed to move compute resources between cloud environment?
A. Orchestration software
B. Data compression software
C. Firewall software
D. Load-balancing software
Answer: A
Question: 250
Creating a Contrail service chain requires the configuration of which three elements? (Choose three).
A. Service Policy
B. Service template
C. Service object
D. Service network
E. Service instance
Answer: A,B,E
Explanation:
https://www.juniper.net/techpubs/en_US/contrail3.1/topics/task/configuration/service-chaining-vnc.html
Question: 251
Which command displays routes in a vRouter VRF?
A. rt
B. show route
C. show route table vrf-name
D. route print
Answer: A
Explanation:
https://www.juniper.net/documentation/en_US/contrail2.1/topics/task/configuration/vrouter-cli-utilities-vnc.html
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Question: 252
Which three load-balancing algorithms are supported by Contrails LBaaS feature? (Choose three.)
A. Destination port
B. Source IP
C. Weighted round-robin
D. Least connections
E. ECMP
Answer: A,B,C,D
Explanation:
https://www.juniper.net/documentation/en_US/contrail3.1/topics/task/configuration/load-balance-as-service-vnc.html
$13$10

Juniper (JNCIS-Cloud) thinking - BingNews https://killexams.com/pass4sure/exam-detail/JN0-413 Search results Juniper (JNCIS-Cloud) thinking - BingNews https://killexams.com/pass4sure/exam-detail/JN0-413 https://killexams.com/exam_list/Juniper Juniper's Hoff Outlines Cloud Security Automation Challenges

In a presentation Monday at the United Security Summit in San Francisco, entitled "Commode Computing: Relevant Advances In Toiletry & I.T. – From Squat Pots to Cloud Bots – Waste Management Through Security Automation," Hoff discussed how operational issues are impeding automation and flexibility of cloud security and putting a crimp on innovation in this space.

Hoff pointed to the innovation that has taken place in toilet technology through the centuries, from the first drainage systems in 2500 B.C., to Sir John Harrington's invention of the flushing toilet in 1596 and Joseph Gayetty's 1857 invention of toilet paper. Absent a similar flurry of creative thinking in cloud security, the IT industry is facing an inelegant future that Hoff jokingly described as "commode computing."

Getting security to scale in infrastructure-as-a-service and cloud environments is a tough challenge that has slowed the pace of automation, Hoff said. "Security fundamentally by design doesn't scale. It's generally not automated because there's a person in the loop, or a policy," he said.

However, attackers are well acquainted with leveraging cloud automation, as evidenced by the efficient functioning of botnets, which have cloud-like underpinnings, Hoff said. "The challenge is we don’t play by same sets of rules," he said. "The reason organizations don’t automate is that they're afraid if a change gets pushed and something goes wrong, they'll lose control."

Another problem is that security professionals, developers, network administrators and systems administrators aren't leveraging a common set of tools for cloud security. What's needed, Hoff said, is automated security that's designed for scale. "We need more intelligence shared between the infrastructure and application layer," he said.

Mobility is another stressor or for cloud security, because policies haven't been adjusted to account for the movement of virtual machines within a cloud environment, Hoff said.

Hoff disagrees with the idea that the network perimeter is disappearing, though. "Virtual machines move, so we are trying to apply policy to each device, which becomes its own perimeter. With the cloud, we have thousands of 'micro-perimeters.' The virtual machine is the de facto perimeter," he said.

It's unrealistic to expect cloud and virtualization vendors to provide all the necessary tools for securing cloud environments, so there are steps organizations can take today on their own, Hoff said. Cloud computing providers can use CloudAudit.org to automate the Audit, Assertion, Assessment, and Assurance (A6) of their infrastructure-as-a-service, (IaaS), platform-as-a-service (PaaS) and (SaaS) environments.

Companies can also get their staff up to speed on programming languages such as CFEngine, Puppet, Ruby and Python, Hoff added. "These guys have enormous libraries that automate existing physical and virtual security controls," he said.

In the future, better cloud security will depend on developers, operational and security staff to work more closely than they've done in the past and embrace things like application security and the secure development lifecycle, according to Hoff.

Automating data protection is also going to become even more critical. VMware's 5 bundling of low level data leak prevention in vShield, which scans virtual environments for PCI data, is an example of where things are going, Hoff noted.

"To leverage cloud computing, security must scale at same pace as the workloads security is supposed to protect," Hoff said. "It's never too late to automate."

Mon, 19 Sep 2011 11:28:00 -0500 text/html https://www.crn.com/news/security/231601704/junipers-hoff-outlines-cloud-security-automation-challenges
Juniper Unveils New Cloud Services Program, Cloud-Based SD-WAN Offering For Partners

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On the heels of its $405 million Mist Systems acquisition, Juniper Networks is continuing the momentum with its first cloud-based SD-WAN offering and Cloud Services Program for partners.

The Juniper Cloud Services Provider (CSP) Select Program is aimed at helping partners develop and deliver cloud and managed services, the company told CRN. The CSP program has been designed to recruit, enable and reward new managed services partners, as well as partners that are already offering cloud and managed services and are looking to expand their portfolio, said Brian Rosenberg, Juniper's vice president of global partners and alliances.

"Juniper is introducing the CSP Select program in direct response to the needs of our partners and their customers. Managed services are an area of explosive growth and establishing a compelling, partner-centric program for managed services signals Juniper’s commitment to supporting our partners’ growth [and] evolution in the cloud and the managed services space," Rosenberg said.

[Related: Juniper Sets Sights On Cisco With Huge Multi-Cloud Portfolio Expansion]

The new CSP Select program will help partners transition to a recurring revenue model, Rosenberg said. Right now, partners can offer four different services to their customers through the program, including Managed Router as a Service, Managed Security as a Service, Managed SD-WAN as a Service, and Managed WLAN, which uses technology that the company acquired from Mist Systems.

Juniper closed its acquisition of AI networking startup Mist Systems earlier this month.

"By joining the CSP program, partners will have access to a Juniper-powered SaaS solution that enables them to manage their customer’s connectivity and security needs on a cloud-based platform and bill them for those services on a monthly basis,” Rosenberg said.

The CSP Program is now available in the Americas. Juniper is planning a future rollout in EMEA and Asia-Pacific in the second half of 2019.

In addition to its cloud services program and portfolio, Juniper on Monday introduced its first cloud-delivered version of SD-WAN. The new Juniper Contrail SD-WAN as a service offering will help customers take the "next step" in their multi-cloud strategies, the Sunnyvale, Calif.-based company said.

Juniper launched its premise-based Contrail SD-WAN offering last year.

"We’re launching a cloud-based version of our SD-WAN solution to allow enterprises to simplify operations by centralizing, automating and abstracting initial and ongoing operations of a distributed fleet of network infrastructure," said James Kelly, Juniper's lead cloud and SDN architect.

Together with Juniper’s Contrail Service Orchestration platform, partners and end customers can manage all of their environments, including the branch, campus and cloud SD-WAN, now with managed security and Mist Learning WLAN technology, the company said.

Mon, 08 Apr 2019 06:14:00 -0500 text/html https://www.crn.com/news/networking/juniper-unveils-new-cloud-services-program-cloud-based-sd-wan-offering-for-partners
Integrated Planning: Cloud thinking

Consumers do not make decisions in a linear way. They are influenced by the cloud of noise around them at different times of the day.

Consumers do not make decisions in a linear way. They are influenced by the cloud of noise around them at different times of the day. We need to understand the interactions with this noise and develop planned nudges that affect behaviour

We have built a world with too much information, too many choices, too many ‘things’ and too many connections. Now is the time for us all to step back and realistically assess the implications for the future direction of marketing communications and research.

Talk to anyone about their everyday lives...

Fri, 24 Nov 2023 10:16:00 -0600 en-GB text/html https://www.warc.com/content/paywall/article/admap/integrated-planning-cloud-thinking/93663
IBM's 'Hybrid' Cloud To Drive Innovation At Vodafone And Juniper Networks
© 2019 Bloomberg Finance LP

IBM’s big bet on the “hybrid” multicloud, a computing environment that combines multiple cloud providers and clouds, is beginning to pay off -- and drive innovation by its partners.

This week, Big Blue made two important announcements regarding its cloud service business. The first was a $550M cloud services agreement with Vodafone. IBM will assume control of Vodafone’s cloud and hosting business. Big Blue will also work together to help Vodafone clients rapidly develop and deploy emerging cloud-based digital telco capabilities.

The new venture between the two long-term partners will help Vodafone integrate multiple clouds.

That’s an important step as the company gets ready for next stage of digital transformation driven by AI, 5G, Edge and Software Defined Networking (SDN).

“This venture demonstrates how we’re delivering on our strategy to radically simplify Vodafone, efficiently scale our business and deepen our customer engagement through a seamless blend of cloud and connectivity,” Vodafone CEO Nick Read is quoted as saying. “By focusing on our strengths in fixed and mobile technologies and combining those with IBM’s expertise in multicloud, this new venture helps us build on the success we’ve seen to date in our cloud business and accelerate its growth.”

The second announcement is a $325-million agreement with Juniper Networks. IBM will assist the network technology company to manage multiple cloud environments, including its existing infrastructure, to help cut costs and speed its journey to the cloud. 

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Koyfin

In addition, the agreement will allow Juniper Networks to leverage IBM’s cognitive technologies and create an agile IT environment. “A key element of our digital transformation is to manage the complexities of our global operation and to get the most out of our current investments,” Bob Worrall, Chief Information Officer, Juniper Networks,” is quoted as saying. “In working with IBM Services, we will be able to partner with them on innovative solutions for our cloud-first business model.”

Big Blue will introduce the “Factory Development” model for application management, which will help Juniper Networks improve efficiency, and cost savings, as it moves toward a cloud-native setting.

“Our work with thousands of enterprises globally has led us to the firm belief that a 'one-cloud-fits-all' approach doesn't work and companies are choosing multiple cloud environments to best meet their needs,” Jetter, Senior Vice President of IBM Global Technology Services, quoted saying. “Working with Juniper, we are integrating cloud solutions with their existing IT investments via the IBM Service Platform with Watson. This gives them the opportunity to generate more value from existing infrastructure, along with helping them manage strategic services that are critical to their business.”

Meanwhile, Red Hat shareholders voted on the proposed acquisition, which is expected to be completed in the second half of 2019.

IBM is paying bucks to acquire Red Hat.  The open source technology company will bring to IBM an innovative hybrid cloud platform, and a large open source developer community.

IBM’s bet on hybrid cloud comes at a time the company is trying to reverse a prolonged decline in revenues and profit margins that has Wall Street fleeing its stock.

Equity analysts welcomed, IBM’s exact partnerships. “These partnerships are important for IBM to show that it’s one of the leading players in the fast-growing cloud market where competition is intense,” says Haris Anwar, Senior Analyst at Investing.com.

Still, he doesn’t see investor sentiment changing in the near future. “But in a broader scheme of things, this arrangement is unlikely to Excellerate investor confidence in its share value in the short-run that has been under pressure for many years. Investors want to see positive results of the company’s turnaround efforts which have so far failed to create any excitement.”

Sat, 19 Jan 2019 01:40:00 -0600 Panos Mourdoukoutas en text/html https://www.forbes.com/sites/panosmourdoukoutas/2019/01/19/ibms-hybrid-cloud-to-drive-innovation-at-vodafone-and-juniper-networks/
City of Las Vegas Harnesses Juniper Networks’ Cloud Metro Solution to Fuel Community and Economic Growth

City of Las Vegas Harnesses Juniper Networks’ Cloud Metro Solution to Fuel Community and Economic Growth

Juniper Networks to power City of Las Vegas network backbone to reach its model smart city goal by 2025

Juniper Networks (NYSE: JNPR), a leader in secure, AI-driven networks, today announced the City of Las Vegas has selected Juniper Cloud Metro solutions for building its private 5G network, powering services for the city government, public schools, tourism and residents and helping the city reach its goal of becoming a model smart city by 2025.

This ambitious endeavor hinges on the city building and operating the largest private 5G network in the United States, complemented by a portfolio of smart city capabilities. To help make this goal a reality, Las Vegas selected Juniper Networks’ industry-leading Cloud Metro solution, featuring ACX7024 Cloud Metro Routers and EX4300 Switches to form the robust backbone of the metro network. This infrastructure is managed using Juniper Mist Wired Assurance, an AI-driven cloud service that enhances visibility, automates operations and assures service level agreements.

The network’s initial coverage, powered by Juniper’s solutions, spans the city’s Innovation District and is rapidly expanding to serve surrounding areas and its residents. Juniper was selected as the official networking provider for its robust solutions that provide the necessary aggregation and backhaul for the wireless traffic to reach 42 million annual tourists, more than 640,000 residents and span 123 miles of fiber support for traffic management. Juniper collaborated with the city’s system integrators to design a future-ready network that is open and intelligent, allowing any third-party application or end-user device to connect.

“We want to make life better for our community,” said Michael Sherwood, Chief Innovation and Technical Officer for the City of Las Vegas. “This means providing amenities in the most efficient way possible, and that’s what connectivity does.”

“Juniper Networks is honored to partner with the City of Las Vegas on their transformative journey. Our Cloud Metro solution is designed for forward-thinking cities like Las Vegas that aim to harness the power of cutting-edge technology to deliver a superior experience in a sustainable manner,” said Julius Francis, Senior Director of Product Marketing, Automated WAN Business, Juniper Networks. “By creating a responsive, AI-driven, and secure network, we're laying the foundation for Las Vegas to offer unparalleled services to its residents and visitors, pushing the boundaries of what a smart city can achieve.”

Information generated by connected city systems will be used to make a positive impact on the day-to-day lives of residents and visitors and allow city leaders to make data-driven decisions, including reducing traffic congestion with creative last-mile transportation solutions and efficient traffic flow for the eventual use of self-driving electric cars.

Resources:

Customer Story – Las Vegas Private 5G Network Fuels Community and Economic Growth

About Juniper Networks

Juniper Networks is dedicated to dramatically simplifying network operations and driving superior experiences for end users. Our solutions deliver industry-leading insight, automation, security and AI to drive real business results. We believe that powering connections will bring us closer together while empowering us all to solve the world’s greatest challenges of well-being, sustainability and equality. Additional information can be found at Juniper Networks (www.juniper.net) or connect with Juniper on X (Twitter), LinkedIn and Facebook.

Juniper Networks, the Juniper Networks logo, Juniper, Junos, and other trademarks listed here are registered trademarks of Juniper Networks, Inc. and/or its affiliates in the United States and other countries. Other names may be trademarks of their respective owners.

Media Relations:
Lori Langona
Juniper Networks
llangona@juniper.net

View source version on businesswire.com: https://www.businesswire.com/news/home/20231115469184/en/

Tue, 14 Nov 2023 22:44:00 -0600 en text/html https://www.morningstar.com/news/business-wire/20231115469184/city-of-las-vegas-harnesses-juniper-networks-cloud-metro-solution-to-fuel-community-and-economic-growth
End-user experience – The only network metric that matters?

The traditional approach to network performance – and issue resolution – is being turned on its head. End-user experience scoring takes an outside-in approach that redefines performance around the experience of its users.

It's all too common for network engineers to spend more time hunting for the source of network performance issues than fixing them. The lack of performance metrics is not the issue. It's often a case of too many metrics obscuring the real root of the issue. In multi-cloud hybrid networking environments, problem validation, isolation, and resolution are getting harder. Yet, it's more important than ever for businesses to find a way of filtering the signal from the noise. As businesses and consumers alike embrace hyper-connectedness, the health of their digital services is increasingly a barometer of business performance. 

Complex KPIs are giving way to end-user experience 

Businesses have their set of go-to tools and metrics they use when a problem occurs. Faced with a multitude of performance indicators, this traditional inside-out approach to network performance is becoming inefficient for network teams and frustrating for end-users. For example, close to 60% of workers have technical issues that the service desk can't resolve. 

The tide is turning, with businesses increasingly recognizing the value of focusing performance metrics on the actual experience of users. Advanced tools can now dig deeper across the KPI clutter to zoom in on how users are experiencing digital interactions and provide a more comprehensive view of the state of the network. So-called end-user experience (EUE) scoring is a major shift away from complex infrastructure-centric indicators like latency or bandwidth, to name just two. By consolidating these and other metrics, businesses can get a holistic view of the health of their digital services through an easily understandable dashboard. 

End-user experience (EUE) scoring - a radical rethink

EUE scoring isn't just another metric. It turns the old troubleshooting model on its head. Instead of starting with the infrastructure and working outwards to resolve end-user issues, the EUE approach starts with the experience of its users, arguably the only metric that really matters. Rather than chasing red performance indicators, with a simple numeric EUE score, network teams can quickly understand if there's a problem impacting the business and how severe it is. 

When issues are detected, instead of wondering which users are impacted and why, multi-dimensional advanced analytics do the heavy lifting to eliminate the many operational variables and hone in on the root cause. This automated domain isolation is a game-changer for already-stretched network teams. Instead of lengthy consultations and war-room wrangling, isolating the root cause means that the appropriate experts tackle the issue earlier, improving resource utilization within the team and speeding up issue resolution. 

From prescriptive to predictive problem resolution

Faster troubleshooting might sound like a win-win for network teams and end users alike, but it's just the start. User-centric approaches to network management that leverage advanced analytics in real-time could anticipate and resolve problems before they occur. While self-optimizing networks may seem like a distant dream for stressed-out network engineers currently, user-centric metrics are already helping to alleviate capacity problems before they become critical in today's business environments. Similarly, having a holistic view of user experience can provide an invaluable first warning sign that an enterprise is under attack from a hack or a breach. 

By prioritizing the user’s perspective in network management, an EUE approach to network performances accelerates issue resolution, improves resource utilization, and even enables predictive problem resolution.

Observer Apex from VIAVI offers a comprehensive approach to end-user experience monitoring. By generating an end-user experience score for every data transaction, it provides a granular view of network performance. Harnessing machine-learning powered automated EUE scoring and offering customizable dashboards for global operational intelligence, Observer Apex not only monitors but helps IT teams elevate the digital experience for users. 

For more information, see our solutions.

Tue, 19 Dec 2023 09:59:00 -0600 en text/html https://www.networkworld.com/article/1269944/end-user-experience-the-only-network-metric-that-matters.html
You’re Thinking About Cloud ROI Wrong -- Here’s Why

Chief Technology Officer at CloudCheckr, responsible for cloud management software development and product direction.

The way we think about performance measurement on technology spend is wrong. In most business contexts, a “positive” return on investment (ROI) implies your earnings from an investment exceed the cost of that investment, but when we speak of cloud ROI, the “I” should mean something entirely different. Cloud ROI should measure return on innovation. 

Some business leaders might argue that every initiative boils down to dollars, and dollars gained over dollars spent is how every business decision should be made. With all due respect to the profession, those with such a binary view are usually accountants. While they’re right (from a very academic standpoint), this assumes you have understood the benefits.

The real measure of value in both cloud infrastructure and cloud services from providers like Amazon Web Services (AWS), Microsoft Azure and Google Cloud Platform (GCP) isn’t naturally expressed in hard dollars. Instead, the cloud is such a fundamentally different way of operating a business that the benefits are often misunderstood and, when reduced to dollars, understated. 

To calculate ROI traditionally, you would take the percentage form of the following: (amount gained - amount spent) / amount spent. The amount spent is pretty easy to understand, even in a cloud world, and third-party cloud management tools make it even simpler to understand these costs. But the amount gained is much more difficult to pin down. 

An example might help. Imagine you’ve traveled back in time to the 1990s and are looking at whether you should invest in email for your company. You’re doing just fine with intraoffice memos and newsletters, and you understand the costs of both pretty well. Email costs would involve a server, some software licenses, computer upgrades for everyone to use it and perhaps even choosing an internet service provider for the first time.

But how would you get the “amount gained” in our ROI formula? How would you know that you’d save some time but not as much as you could because people would “reply all” to every email for the next decade? Or that you’d lose time due to email-spread computer viruses? Or that you’d sell more widgets because your team was better coordinated? Or that the next version of your widget would get to market in half the time, beating your competition and increasing sales team productivity by 20%?

In retrospect, or as a time traveler, we know that investing in email for your company in the 1990s was a good decision, but we can’t calculate ROI, and trying to do so is an excuse for skipping real critical thinking.

The same holds true for cloud infrastructure investments. As technology managers, our responsibility is to understand and help express the true benefits of a digital transformation, which is why I started by asserting that ROI (investment) is dead; long live ROI (innovation).

Cloud isn’t just an investment; it’s an innovation 

To understand the impact that a digital transformation can have on your business, let’s use an example from the banking industry. Writing an application for mobile check deposits that scales out to millions of customers and thousands of check images per hour might take years of design, implementation, hardware purchasing and configuration, and infrastructure management. But a more modern bank might decide to write that application using auto-scaling serverless technologies in the cloud, avoiding the complexity and resulting time and cost of its competitors’ path.

In the end, both banks will have a mobile check deposit feature, but the bank that does it later might not win as many customers, might have to spend more to acquire a customer or might lose more customers in the interim. Your organization’s product or service velocity is valuable beyond the simple comparison of servers to cloud subscription.

Calculating return on innovation for the cloud

If traditional return on investment is calculated based on the formula (gains - investment) / investment, return on innovation can be calculated using the formula (new value - beginning value) / beginning value. Here are some ways you can estimate the new and beginning values for your digital transformation:

New value is the value of the cloud to your company. For example, a product company might choose sales achievement as a new value, positing that moving to the cloud will help it bring a new product to market three months faster, and take the new value as either the gross margin or top-line revenue from those additional months of sales. A software company might take the number of story points achieved per person with cloud infrastructure, opening the door to an ROI calculation that is not a ratio of dollars but some other velocity metric.

Beginning value is the value without your cloud investment. For example, you might start from the current run rate of sales achievement, the current lifetime value of your customers (as influenced by churn and price) or your current software development velocity.

This modern method of measuring the true ROI of cloud infrastructure, rather than one based on capital expenditure investments alone, enables business leaders and IT executives to more accurately communicate the value of a digital transformation strategy. Now, go forth and innovate using the cloud in all the ways it can transform not just your cost structure, but your entire business — without the constraint of an archaic ROI definition. 


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