So your firm has decided to migrate to the cloud. Cloud computing can add value and provide tremendous benefits to your organization. It is extremely important for organizations to have a well planned strategy to migrate to the cloud. This is especially true for organizations that have been an in-house development and infrastructure IT organization. Many in-house IT organizations may not have dealt with cloud vendors and may need someone to guide and provide assistance.
Our recommendation is to develop a comprehensive RFP (Request for Proposal) in conjunction with site visits, customer reference checks and vendor presentations. It is important that all pertinent information is contained in the RFP response so that an apples to apples comparison can be conducted. Some of the areas that need to be included outside of the standard functionality are: SLA’s (Service Level Agreements), Contract Terms and Conditions, Financial Stability, Rate Increases, Integration, Telecommunications and Business Continuity Planning.
SLA’s (Service Level Agreements). SLA’s need to be reviewed and thoroughly understood by the potential customer. Whether the organization decides to implement a private environment or become part of a shared environment, the SLA must spell out how outages, upgrades and enhancements will be handled.
Contract Terms and Conditions. A thorough review of the contract terms and conditions needs to be conducted. The contract needs to specify how rate increases whether transactional or a monthly fee are handled along with billing terms. In the event of issues, how are the differences resolved. Provisions need to be spelled out for how increases for services will be charged and how the relationship will end in the event of termination. How the customer will receive a copy of their data and what is the format of the data. A proprietary file format will not be very useful.
Financial Stability. A review of the cloud providers annual financial statements for the last three years needs to be conducted. Items such as research and development needs to be included in the review along with information on the existing relationships with 3rd party providers.
Rate Increases. Once your organization has migrated to the cloud. Your firm may not want to migrate to another provider. Prior to completing a deal, it is important to understand how the cloud services agreement will handle rate increases for transactions, services and hosting (if applicable). Also what is the frequency of rate increases and is there a percentage cap on the amount of increase.
Integration. How the cloud provider connects to your existing customers and suppliers is a major consideration. In most cases this is a real asset of the cloud provider as they have in-depth knowledge of EDI and XML and may have links already established. How the cloud provider can connect to your other systems that may not be hosted in the cloud (ex. financial and accounting systems) is extremely important.
Telecommunications. Connectivity to the cloud provider is extremely important. Many cloud providers tout that customers can connect with any device anywhere. It is important that both the customer and provider have a robust telecommunications environment with redundancy and scalability to handle peak volumes.
Business Continuity Planning. Many cloud providers tout their business continuity models. However, a comprehensive review needs to be undertaken to review the documentation, frequency and results of business continuity tests.
Logistics Trends Inc. can help your firm if you are thinking of implementing a cloud based solution. We have over 34 years of experience in information technology, logistics, supply chain and transportation. Contact us at 770 639-2230.