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How Manufacturers Can Benefit From Cloud Computing

Fri, 05/17/2013 - 10:53am
Jon Minnick, Associate Editor, Manufacturing Business Technology

Manufacturing Business Technology took some time to talk with Sanjay Ravi, managing director of discrete manufacturing at Microsoft Corp. about cloud computing in the manufacturing sector and how companies can benefit from it. 

Manufacturing Business Technology: What cloud computing options exist for manufacturers and why should they consider them over other on premise delivery forms?

Sanjay Ravi: There are different aspects of cloud: private and public. Microsoft believes that cloud implementations in the future will be a hybrid. The most significant scalability and cost benefits come from the public cloud. With the private cloud, you retain more control and you have maximum customizability, but you also must purchase and manage the infrastructure. Here at Microsoft, we believe you should be able to choose how you use the cloud. Depending on what fits your business best, you could look at a public solution, or a private solution, or in what we believe will be the most common choice — a bit of both. A hybrid cloud gives you the best way to balance risk and opportunity, and make cloud work for your business on your terms. 

We also see manufacturers leveraging cloud resources to support peak compute cycles and storage requirements with less capital expenditure, and also innovate to support new business processes and business models. Manufacturers are also integrating cloud services into their own products. M.G. Bryan is using our Windows Azure cloud-computing platform for remote asset management.  Working with our partner Rockwell Automation, M.G. Bryan designed an equipment control and information system that provides secure remote access to real-time information, automated maintenance alerts, and service and parts delivery requests.

MBT:Can you describe the type of company that can typically best benefit from cloud computing?

Ravi: Microsoft’s cloud service offerings will provide value to companies of all sizes. Smaller companies can leverage cloud services to bring sophisticated enterprise-level security, backup, and redundancy capabilities to their solutions – capabilities they might not have been able to afford with their limited IT resources.  Large enterprises can make strategic decisions about workloads that can be moved into the cloud in order to free up IT resources for more innovative, strategic projects rather than operation and maintenance of infrastructure. Cloud provides companies of all sizes the opportunity to innovate and either migrate existing solutions to a cloud environment to reduce cost and gain increased agility, or implement new business models and processes at high velocity and at lower costs.

MBT: There is some resistance for companies to turn to cloud computing. What are the top concerns/fears companies have about moving to cloud computing? How do you address these?

Ravi: There is the fear that the time, money and resources invested into previous IT systems would be wasted, or the systems would need to be thrown out. There is also a lot of security and compliance concerns about the public cloud.  While some existing IT components may need to be adjusted, the overall benefits far outweigh the cost of this adjustment. Microsoft’s cloud services are backed up by enterprise-class availability and security.

When Flextronics decided to move applications from an internal server to the cloud in order to support 2,000 new service centers, they had to rewrite only 20 percent of their code in order to migrate to the Windows Azure cloud development tool and platform. Then Flextronics CIO David Smoley said that once it was done, they could use their applications in all 2,000 centers immediately, whereas the past model would have required a three-year rollout paced by hardware and staffing requirements. They calculated that over three years, their hardware, software, and staffing savings could exceed $2 million.

Choice and flexibility are key to cloud adoption now and in the future. Our goal is to help you make the cloud work for your business. It should be up to you to decide what you want to deploy in the cloud and when, so you have the ultimate ability to balance control and flexibility with cost and agility. One of the benefits of the Microsoft cloud is that it spans from private to public and is designed for integration, making it easy to move between the two or supplement your existing infrastructure with cloud services.

MBT: What flexibility does cloud computing give manufacturers over an on-premise system?

Ravi: Cloud services offer compute and storage resources as needed. Cloud computing also enables manufacturers to run large simulations for product development, rather than investing in the physical resources needed for testing. The cloud provides the scalability to meet the peak compute and storage needs, and customers have to pay only when they use those resources. This approach can reduce product development cycles and cost.

MBT: When it comes to cost, how does cloud computing compare to other forms of delivery?

Ravi: The biggest benefit with cloud computing is the savings that are possible through lower staffing costs, and lower licensing costs.  Additionally, manufacturers see savings by reducing equipment and power costs required by traditional on-site servers as well as faster time-to-deployment and scalability of computes and storage as needed.

MBT: In terms of cloud computing, are there incentives, financing or pricing options companies should be aware of?

RaviWindows Azure and Office 365 both offer flexible pricing plans, depending on the needs of your business. 

MBT: If a manufacturer wanted to ease into cloud computing, where would you suggest they begin (i.e. what systems or processes should they start with)?

Ravi: One of the best places to start is by migrating productivity and collaboration systems to the cloud. For instance, Freescale Semiconductor moved enterprise email to the cloud with Office 365, and provides the same service at half the cost.  And Freescale employees got much more storage – 5 GB per user compared to 100 MB.

With Microsoft, you would be to embrace the right IT for your business by moving to the cloud at your own pace, with a comprehensive range of enterprise cloud offerings that span on-premises and online. You can also make more of your existing investments in infrastructure, tools, and skills. In addition to cost reduction and speed, you will also be able to delight your users with the best experiences that reflect how they prefer to do their work and interact with others.

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