Monday, October 30, 2017

Seasonality and the Cloud: It’s Not Just For Commerce Anymore

Rich Wood, Vice President, Microsoft Alliances
Cloud / Innovation / Platforms / Technology

Autumn is here. The leaves are falling, kids are dressing up in costumes, and the news is already telling us which stores will be open on Black Friday (and when). There’s no better time on the calendar to revisit a core concept of both Commerce and the Cloud infrastructure that supports it: Seasonality

Seasonality has a great many applications across a myriad of industries, but the holiday shopping season—and how the Retail industry prepares, accommodates, and ultimately does everything it can to amiably help you spend your annual bonus—remains the most telling example of this key Cloud concept. 

Once we understand how Seasonality is applied to Commerce in the Cloud, we can begin to see use cases across a wide range of industries and business cases. When we see and understand the impact of Seasonality in Retail, we can build a deeper understanding of how and where applications in our own industries are candidates for Cloud migration.

Seasonality 101—Retail, Black Friday, & Avoiding Outages

Regardless of application, platform, or workload, every Cloud conversation I’ve ever had has ultimately included the words “flexibility” and “scalability”. These aren’t new drivers for Cloud computing—in truth, by now they’ve attained classic status—but they’re still common baseline justifications for why companies are moving increasingly complex systems into the public Cloud. Why? They’re still relevant—and nowhere more relevant than the Retail industry during the lead-up to the holidays. Put together, they’re called Seasonality and there’s no more basic driver for Commerce in the Cloud.

If “flexibility” is the opportunity to quickly and easily tailor a computing infrastructure to your requirements, and “scalability” gives you the option of quickly adding or removing additional servers to handle changes in volume, Seasonality is the need to do both of those things, typically in response to an anticipated surge in volume that is tied to a date range. 

The shopping season that ostensibly begins the day after Thanksgiving and ends with Boxing Day clearance sales has been, and remains, the single best example of Seasonality as a driving requirement for Cloud infrastructure. We say “ostensibly”, but in reality, that season has already begun, and typically extends through the New Year’s Day weekend. Both the “lead in” and the “tail” of the holiday season provide great examples of gradual ramping both up and down, to meet waxing and waning consumer demand.

Commerce sites that aren’t hosted in the Cloud tend to go down hard during the holiday season. Predictably, their old on-premise architectures tend to fail them, falling flat under the sheer volume of simultaneous orders they need to process. While larger Retailers have mostly learned this lesson and migrated to Cloud infrastructures at this point, it’s still a danger for many smaller businesses. Happily, Cloud solutions and pricing models for both Commerce and CMS are relatively affordable now and outages due to massive increases in order volume are becoming less and less common.

Seasonality in Other Industries

One of the benefits of working at an independent digital agency like Rightpoint is serving a wide variety of clients and industries, which allows us to apply lessons learned from one industry to problems faced in another. The case of Seasonality and the Cloud is a fantastic example. When you understand how Seasonality applies to the Retail industry, you can begin to see applications of it across the entire spectrum of business and industry.

Some Seasonality trends are similarly driven by consumer spending cycles. Naturally, those Consumer Packaged Goods (CPG) companies with direct B2C outlets, drive enormous amounts of online order processing and are subject to the same drivers as their Retail cousins. That’s an easy and obvious example, but consider more deeply: Across the Insurance industry, Seasonality is a key driver of Cloud workloads. Health insurers need to ramp up certain systems during annual periods of open enrollment. Property and Casualty insurers know very well what times of the year are buying and selling seasons for new houses, new vehicles, and the attendant new policies to insure those new homes and cars. 

Certainly, broad industry trends like these are the most obvious drivers. Many more spring easily to mind. Take Financial Services—and think of an accounting firm in the run-up to Tax Day on April 15.  Care to bet that their consumption of processing power during the spring dwarfs what they’re using during the lazy months of summer? Manufacturers of seasonal products are another obvious example. Just like their consumption of tactile resources, their consumption of computing resources ramps up and down with the regular cycles of supply and demand. In an industry with such razor-thin profit margins as we sometimes see in Manufacturing, wasting money on servers you’re not using during a planned “slow period” can be a grave enough sin to get a CFO in hot water.

Still, dig even deeper and you begin to uncover ever-narrower reasons to look at the Cloud from a Seasonality perspective. Geography can be a driver: Any region or locality with a “four seasons” climate is going to have higher accident rates for a health care provider to deal with during winter. Even major IT investments can push significant peaks and valleys in a system’s workload. If you’ve worked with a healthcare system deploying a major Electronic Health Record (EHR) system, or a manufacturer devoting millions of dollars to implementing a large, monolithic Enterprise Resource Planning (ERP) platform, you see how many resources—human, financial, and technical—are devoted simply to supporting that rollout. 

Take Advantage of the Cloud

In short, Seasonality goes far beyond Retail as a driver for Cloud workloads and consumption of Cloud resources. Without a sound Cloud infrastructure, in every one of the above cases and many more that we didn’t name, you’ll likely be looking at long periods during the year with significantly under-utilized (and therefore, fiscally irresponsible) computing resources—or in the reverse case, other periods where an insufficient architecture fails you at the worst possible time. A sound Cloud Strategy and a flexible, scalable Cloud Platform are the best way to avoid this sort of pain. Major retailers learned this long ago and are now driving a huge portion of Cloud computing resources. Where in your industry are there efficiencies to be gained from the Cloud—and more to the point, how can your company take advantage of them?  

Rich Wood is the Senior Director of Cloud & Enterprise Apps at Rightpoint. Follow Rich on Twitter and LinkedIn