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Digital Business Transformation Drives Retailer to Build Hybrid Cloud

Premise: Many IT organizations are attempting to respond to increased business demand for more agility, but they are struggling to deal with the complexities of using both on-premises and public cloud resources to accomplish those goals.

[This research will highlight a recent case-study by Wikibon of a large US-based retailer that was able to deliver new business value by deploying a simplified Hybrid Cloud architecture for the internal application developers.]

With over 600 stores, operating in all 50 states,  this US-based retailer is a leader in content, digital media and educational products. The retailer is facing challenges as consuming shopping patterns are shifting online and leveraging technologies to inform their buying decisions. These new digital experiences are forcing the business to look at faster ways to deliver new applications to enhance their customer’s experience.


Can traditional businesses leverage Hybrid Cloud to compete more effectively? 

It is not uncommon for an IT organization to look at their mix of business projects and attempt to determine how to satisfy all of them within a given set of constraints – available IT resources, internal skills, financial budgets, etc. And with the growth of public cloud services, IT is now under increasing pressure to not use internal resource constraints as a reason for a business project to move forward. Since nearly every new business project has an IT component, an increasing number of IT leaders are exploring ways to create Hybrid Cloud environments to help their business manage both agile business requirements and longer-term stability requirements.

As businesses explore Hybrid Cloud offerings, they are being forced to align Application Portfolios with Hybrid Cloud strategies. While many large vendors have offerings in the market that dictate the underlying hardware or software components, a major US-based retailer looked at a simplified option from Avni that removed many of the constraints found in other solutions.


The Business Challenge – Ship More Digital Products and Provide Greater Developer Focus

The retail shopping experience has been evolving over the past decade, with online shopping becoming a growing part of the overall retail experience for many customers. While online shopping only accounts for 7.4% of total sales in the United States , many consumers incorporate a digital experience into their buying research. The expanded digital experience means that retailers need to rapidly integrate new functionality into their websites, in-store kiosks, mobile applications, and social media presence. These digital “products” are rapidly changing and can vary from season to season.

Online Retail Sales as % of Overall US-based Retail Sales (Source: US Dept of Commerce)
Online Retail Sales as % of Overall US-based Retail Sales (Source: US Dept of Commerce)

The challenge for the IT department of the retailer was that internal resources were often limited or heavily utilized, causing problems when new project requests need resources very quickly. It would often taken over a month to acquire new equipment, assuming CAPEX budget could be obtained, and often times the impetus for the project would have expired by the time that the server and storage infrastructure could be put in place.

Enabling a Simplified Hybrid Cloud

“Our existing business has a self-service model (based on VMware vSphere) where resources can be allocated to developers, but this is a finite pool of resources. Unique business situations would arise where IT didn’t have enough resources for some new projects, or we would have situations where the digital product didn’t succeed in the market and we’d still have the CAPEX investment being under-used.” – Senior IT Manager at US-based retailer.

The retailer’s IT staff began experimenting with various public cloud services, including Amazon AWS and Microsoft Azure, to not only understand how the technology worked, but also to understand the type of experience they needed to deliver to their internal developers. They understood that the pricing needed to be transparent to the business team, and the experience needed to be as seamless and frictionless as possible. Neither the IT team or the business team wanted to spend cycles doing application integrations or migrations due to complex technical environments in the public cloud.

After researching several Hybrid Cloud options in the market, the retailer selected the Software Defined Cloud solution from Avni. The Avni solution allows the retailers team to view and manage the application from a single UI portal, regardless of whether it resides in their Private Cloud or Public Cloud. This allowed the IT organization to provision resources in either type of cloud, depending on resource availability and business priority.

Hybrid Cloud Architecture - US-based Retailer (Source: Wikibon, 2015)
Hybrid Cloud Architecture – US-based Retailer (Source: Wikibon, 2015)

In most cases, the retailer would provision new application resources in the Microsoft Azure public cloud, build and validate the new application, and then migrate the application back to their private cloud environment when it was ready for production. This allowed the IT team to provide consistency levels of security and compliance for production applications. During peak times of year, such as the winter holidays, the retailer would continue to leverage the public cloud resources to manage the additional scalability needed for the digital experiences. The application migration process, in either direction, was centrally managed from the Avni management console by the IT operations teams. Due to the way that Avni virtualizes both the application stack and the underlying network resources, no applications were required by the development or operations teams.

“The Avni tools were very simple to learn and use, and about 50% of the cost of the alternative options we explored. It took just a few months of re-training to understand how public cloud worked because we needed to learn the new terminology, but once we understood that, it made the ability to create a Hybrid Cloud environment very simple. The Avni integrated load-balancing and security helped eliminate quite a bit of complexity for our applications teams. Our developers loved the faster response times from the IT team.” – Senior IT Manager at US-based retailer.

Understanding Avni’s Software Defined Cloud

Avni Software Defined Cloud (SDC)
     Avni Software Defined Cloud (SDC)

Avni’s Software Defined Cloud (SDC) technology provides a cloud management platform for IT organizations and Application teams. The Avni SDC virtualizes existing and next-generation applications and allows them to be deploy on any cloud platform. Avni SDC eliminates the challenges of multi-cloud interoperability, and simplifies the process of migrating and managing applications across multiple cloud platforms.

How IT Manages the Hybrid Cloud 

Even with the right tools in place, many companies struggle with the new skills and internal processes needed to operate a Hybrid Cloud environment. For the retailer, the simplest solution was to have the Windows and Linux SysAdmin teams manage the Avni-based Hybrid Cloud , because they were already responsible for all elements of the Operating System and Application stack. The underlying virtualization environment (VMware) is managed by the Hardware/Infrastructure team.

The retailer’s IT organization expects to add several more internal applications, including the SAP environment, under Avni management soon. “As part of the private cloud, we’re adding more automation capabilities, which allows us to scale the app-dev servers faster and have fewer resources idle at any given time. It saves us money and creates a better relationship between the business teams and the IT organization.”

Action Item: As more companies build applications to enhance their customer’s digital experience, the need to leverage on-demand public cloud resources will continue to increase. Many of these applications must integrate with existing systems of record, so the need to create a Hybrid Cloud will be critical for many Enterprise and Mid-Sized companies. IT organizations should look to use cloud management technologies such as Avni Software Defined Cloud, to simplify the complexities of a multi-cloud environment for both developers and operations teams. 

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