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Jointly Developed With:

This material is For IBM and Business Partner Use Only©WhiteboardSelling, LLC. 2007-2010. All Rights Reserved

Delivering Value Through Cloud Computing

1 Opening the Discussion

QUESTIONS TO ASK1. What are the goals or

objectives that you have for this discussion?

Based on our conversation in setting up this meeting I would like to review the OBJECTIVES that we set out for today and specifically what areas of Cloud Computing you would like to review.

[Write-out Delivering Business Value through Cloud Computing]

One of the more interesting finding in our CIO Global Survey last year was that over 35% of the CIO’s identified Cloud Computing as one of their more important visionary initiatives at the same time we continue to find that there are many questions related to why, where and when should Cloud Computing become a piece of the IT strategy.

I hope that by the end of our time together, we will not only address the objectives we established but you will have some new ideas on how Cloud Computing can benefit your organization and also how we can move forward to achieve those benefits.

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Pointers on Using this Whiteboard

1. You should make sure that you are familiar with the customer's industry and their specific pain points before this meeting.

2. Be prepared with challenges, drivers and client examples that are relevant to your client's industry, location and size.

3. Write OBJECTIVES in upper right corner so you can refer to them throughout the meeting

4. Have references that are relevant to the customer either by industry or problem;

5. Make sure that you ask questions and engage the customer to better ensure that your discussion is on point.

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1 Opening the Discussion

2 Business Challenges

QUESTIONS TO ASK1. Are these challenges in line

with those you and your organization are facing?

2. Are there any other challenges that you face?

Like any IT executive (manager) these days there are a growing number of challenges that we commonly see among our customers.

GLOBALIZED OPERATIONS AND INCREASED COMPETITION presents challenges to business operations as we need to reach more people with the right IT services and providethem with access to information more quickly - we also need to ensure that our operations are tuned to help the organization meet increasing competitive pressures.

DATA AND INFORMATION REQUIREMENTS ARE EXPLODING - The growth in digital data is projected to be 10X between 2007 and 2011. The challenge is that smarter organizations will generate vast amounts of data that will be disseminated at networking speeds. This data is generating new workloads such as business intelligence, financial analytics, threat and security management, and intelligent search. This means that enterprises have to work smarter by working in new ways rather than working harder by doing more with less.

DATA CENTER COSTS ARE INCREASING especially as they relate to energy and personnel. This puts increased pressures on already tight IT budgets but also presents challenges as stakeholders look to IT to become more "Green" and work in smarter ways.

CUSTOMER EXPECTATIONS - today customer and market demands are creating more and more pressure on companies to be flexible in their business and IT operations to meet changing customer requirements. Financial pressures mean that companies need to look for new more cost effectives approaches to working with new and existing customers.

These and other challenges which you may have are placing more and more pressure on IT infrastructures which were not, in most cases, built to handle the growth & opportunities being created by a smarter planet.

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2 Business Challenges

3 IT Drivers

QUESTIONS TO ASK1. Are there other drivers or

demands being placed on your IT organization?

2. What are the most important or pressing drivers for you?

Against these business challenges there are a number of drivers for IT organizations.

DO MORE WITH LESS - Reducing operational spend and capital expenditures is paramount. IT organizations are being asked to Do More with Less - this means reducing operating costs, capital expenditures BUT also being able to support new initiatives.

HIGHER QUALITY SERVICES to all the key constituencies. This not only means providing high quality service, but also introducing new services that enhance the ability of the organization generate new revenues, cut costs or to accelerate the delivery of data, information and innovative NEW products and services.

REDUCING RISK, addressing today's security and compliance challenges and preparing for the new risks of a more connected and collaborative world. With the trends of increased collaboration and anywhere, anytime access by employees, partners and customers becoming the norm, you must ensure the right levels of security and resiliency across all business data & processes.

BREAKTHROUGH AGILITY - Be prepared to be able to capitalize ON NEW OPPORTUNITIES, by having the ability to accelerate the delivery of NEW IT services without sacrificing your ability to contain costs & manage risk - this means incorporating Breakthrough Agility. As enterprises extend their operations - to new partners, new clients and new geographies, users are demanding more agile and responsive business and IT processes.

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Cloud Computing…Smarter Planet Connection

Technology is available today which can help organizations to become more interconnected, more intelligent - SMARTER in the way they work – Cloud Computing can be a key element in how IT can help to build smarter organizations.

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3 IT Drivers

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QUESTIONS TO ASK1. Does Cloud Computing

align with your IT plans?2. What are trying to

achieve with Cloud?

Simply put, CLOUD COMPUTING is a new model for delivering and consuming IT capabilities (services) that has been inspired by consumer internet services and is both a user experience and a business model.

It is a style of computing in which applications, data and IT resources are provided to end-users as services delivered over the network. It enables self-service, economies of scale and flexible sourcing options. Cloud computing is an approach for managing large numbers of highly virtualized resources to deliver services.

When establishing a Cloud Computing environment, 3 key elements which need to be taken into consideration—Service Delivery & Management, Workloads, and Deployment Options:

SERVICE DELIVERY AND MANAGEMENT – This includes the standardization of processes and underlying services to provide visibility, control and automation. A key element to this is having a comprehensive Service Management infrastructure in place. Cloud enables self-service and provides end-users with the ability to more efficiently source new services (or applications) and access the data and services that are key to their operational activities.

In general Cloud Computing supports three categories of service:

1. Infrastructure-as-a-Service - Customers use cloud-based processing, storage, networks, other computing resources with more rapid and elastic provisioning and control - to deploy and deliver IT capabilities. 2. Platform-as-a-service is defined as a set of software and product development and test tools that are hosted in the cloud.3. Software-as-a-Service represents web delivered applications (anything from sales force automation, Web-based email to inventory control and BI).

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What is Cloud Computing?

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4 What is Cloud Computing?

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QUESTIONS TO ASK1. Have you considered any

specific workloads or applications?

WORKLOADS – There are some workloads (applications or services) that will probably never be delivered in a cloud - there are some that we consider “low hanging fruit” in terms of their ability to generate a rapid return on investment. Taking a workload–oriented approach to cloud computing is critical because it will help you determine which workload and services make sense for you to move first and to which type of cloud – private, public or hybrid solution. Workload characteristics drive the rate and degree of standardization, Complex transaction and information management processes will likely present challenges and risks of migration to standardized services. Other workloads such as BI, collaboration, dev-test, and low-volume transaction systems (SFA, CRM) will move faster.

DEPLOYMENT OPTIONS - Some use the word “Cloud” to describe new consumption and delivery models. Regardless of terminology, it is clear that these new models are emerging for the enterprise – even if they were first inspired by consumer Internet services. Self-service, economies-of-scale, new choices for of service delivery – these define new and more flexible deployment options - whether it is a public, private or hybrid model.

[PUBLIC] ”Public cloud” usually implies acquiring services on a subscription basis from the cloud provider’s cloud

[PRIVATE] “Private cloud” usually indicates a cloud built for a client—behind the client’s firewall and run by either the client or a service provider

[HYBRID] Hybrid combines these two.

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LESSONS LEARNED:WORKLOADS

Workloads in different organizations will be at different stages of readiness and have different architectural characteristics. Not all workloads are necessarily ready for a cloud computing deployment model.

Workloads that clients ARE ADOPTING now include test and development, desktop, collaboration, storage, compute and analytics. All of these are highly standardized--the more standard the environments the better the economics are going to be.

What is Cloud Computing? (continued)

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5 What is Cloud Computing? (continued)

6 Getting “Cloud Ready”

[Draw in an IT facility and overlap with the Cloud] One thing that we acknowledge and have found is that for most customers traditional enterprise IT and cloud computing will not only co-exist but IT will increasingly adopt & use cloud computing as a key deliveryoption for selective workloads and as a way to transform its operations and improve its ROI to the organization

The implementation of a cloud ready IT infrastructure can be best described as a best-practice evolution of a dynamic infrastructure, which has the characteristics necessary to improve the quality and speed and reduce costs of delivering IT services.

Specifically, an IT infrastructure that is “cloud-ready” will have optimized the following characteristics and capabilities:

CONSOLIDATION OF IT RESOURCES - reducing complexity, optimizing resources, improving efficiency by having fewer things to manage - and improving operational costs.

VIRTUALIZING more of their IT resources to increase hardware utilization, reduce hardware costs, simplify deployment and create a more efficient, scalable environment. [LOWER COST]

STANDARDIZING on common components and processes for delivery, management, security, networking and business resiliency (disaster recovery, back-up and restore). [IMPROVE FLEXIBILITY]

AUTOMATING the provisioning of resources and services while helping to reduce IT resource setup and configuration cycle times. [INCREASE SPEED]

This smarter-dynamic infrastructure can provide significant value by helping make IT innovation possible, raising ROI of IT and positioning IT to deliver accelerated business value.

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6 Getting “Cloud Ready”

7 Getting Started with Cloud Computing—Creating Business Value

An organization gets started with Cloud Computing through multiple avenues. Here are a few examples that IBM finds give some idea on the potential for creating business value.

[STORAGE] With the increasing move to digital data, many industries need to store and retrieve more data and increasingly larger files at high speed. A storage cloud solution can better enable access to data from across the organization as well as enable storage of the files in a single logical location which can be increased or decreased precisely as the business requirements dictate.

[DESKTOP] Desktop and PCs can also be a huge drain on IT resources for a company. Cloud initiatives can enable individuals to collaborate more effectively, get access to information more quickly and accelerate the speed of bus processes no matter where the people are located -dramatically improving productivity while reducing costs and improving the service delivery.

[DEV/TEST] R&D and testing can consume infrastructure resources and it’s costly for developers to build and support the necessary environment. A cloud solution can help cut cost and time spent on developing and testing products by providing on-demand capacity and access to tools and technology.

[COLLABORATE] A cloud collaboration solution can bring people and information together quickly and simply in an easy-to-use environment, designed with security in mind.

[ANALYTICS] IBM Smart Analytics System provides cloud-enabled support for analytics solutions, including, data warehouse capabilities; business intelligence capabilities including reporting, analysis, and dashboards; cubing services enabling multi-dimensional analysis; and, text and data mining on both structured and unstructured information.

[…] IBM is continually working to bring out new cloud-enabled “workload” solutions.

These are just a FEW examples of how organizations can start reaping the benefits of cloud computing.

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CUSTOMER EXAMPLE:HARLEY DAVIDSON

BUSINESS BACKGROUNDHarley Davidson looked to consolidate the management of multiple data centers into 2 centrally located Centers. Additionally, many manufacturing facilities had their own IT Departments; Each Business Unit retained their own IT Services.

SOLUTION OVERVIEW•Consolidated 7 Service Desk solutions into a single IBM Solution to automate resolution of both problems and incidents resulting in a reduction in downtime.

•Consolidated all the events into an IBM event management solution to provide a centralized alerting system. This now gives them full control over all business impacting eventsleading to improved SLA’s.

•Streamlined the desktop management of 11,000 workstations with IBM’s provisioning solution to automate a world-wide rollout of a single standardized operating system saving significant $$ in license and support costs.

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7 Getting Started with Cloud Computing—Creating Business Value

8 Roadblocks to Cloud Computing

What potential roadblocks exist to starting a cloud initiative? Based on a recent IDC study, IT executives have identified 4 roadblocks to their Cloud Computing initiatives:

FUNDING – IBM can help you identify key workloads and quantify return on investment (ROI).

SERVICE QUALITY – in order to support SLA’s Service Management is a necessity. Just a few of the challenges that customer’s face include: monitoring of the infrastructure, managing performance and event data, scheduling, provisioning key business services (including storage) and lifecycle management of assets. Last but not least, in a complex, dynamic environment process automation is a must. IBM’s integrated approach and key “enabling” technologies help you address all of these area’s.

SECURITY/PRIVACY – one of the major concerns customer’s have with cloud is who has access, what level of access, and what they are doing with it. Challenges include handling things like mandatory recurring credential changes and auto expiring credentials in a dynamic, highly virtualized environment. Tracking and reporting for compliance can become very difficult. IBM solutions address all of these challenges and more.

“CHANGE” – When talking about change and the challenges associated, most customer’s face two issues: managing change’s to the infrastructure in a complex environment (issue’s like imagine management, impact of change, etc.) and process/people changewhich is sometimes more challenging. Customer’s may find the necessity to redeploy resources to support new processes that are needed in the cloud infrastructure. IBM offer’s an integrated process automation platform to support repeatable IT functions like: incident, problem, change, configuration and release management. With our vast experience in Cloud Computing we are leader’s in the process/people area.

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CUSTOMER EXAMPLE:HARLEY DAVIDSON—Actual Results

•91% Decrease in Critical Events

•29% Decrease in Downtime•3% Increase in Overall

Availability•17% Faster Identification and

Resolution in Root Cause

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8 Roadblocks to Cloud Computing

9 Customer Proof Points

PIKE COUNTY SCHOOLS (Kentucky, USA)--DESKTOP CLOUD. 10,000 students, 27 schools and 3,000 employees. PCS achieved a 62% reduction in end user support costs - equal access to education content across 27 schools & over 2,000 desktops. They accelerated implementation of new courseware from 1 year to INSTANTLY across all schools.

SK TELECOM (South Korea): DEV/TEST CLOUD provides developers with the necessary software & hardware in a secure, stable environment to more quickly develop, test & publish new end-user services for their 24M customers. It has enabled SKT to minimize up-front costs and reduce investment risks; achieve faster time to market and decreased barriers to entry of new services.

KANTANA ANIMATION (Thailand): Needing to store & retrieve extremely large files at high speed, they looked for a cost-effective, single logical location solution accessible by all animators. IBM STORAGE CLOUD provides: increased productivity; enhanced, cost-effective dynamic scalability; reduced admin workload and costs with IBM Scale-out File Services

PANASONIC-COLLABORATION CLOUD. Key was to create globally integrated enterprise with quicker, more efficient teamwork and ability to conduct commerce worldwide. Results - reduced TCO for communication & collaboration. operations, while leveraging existing investment, saving 30 min/day/person.

IBM SMART ANALYTICS CLOUD $20M Savings…200K Users IBM is leveraging the Smart Analytics Cloud for System z. “Blue Insight” is the world’s largest private Business Intelligence (BI) cloud solution and has resulted in >$20M savings projection over the next 5 years. Enabled IBM to move from 20+ BI products and installations to a centralized (Cognos) deployment to deliver BI with access to 60+ data sources (+1PB of data) to the >200K IBM users over the next 18 months who use BI to do their job.

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9 Customer Proof Points

Additional Customer Stories available in the Use Case Scenarios/ Customer Examplessection.

In addition to our customer experience, much of our approach is based on OUR OWN transformation. One example can be seen within IBM Tivoli (one of IBM’s SWG brands that provides service management solutions).

Mission •Consolidation of IT footprints that had expanded through organic growth and acquisition•Implement standards/tools consistently throughout enterprise•Pressure to reduce capital expense

Tivoli’s Cloud Transformation to Date

•Consolidation of 38 labs to 5 (Tucson, Austin, Rome, Krakow, & China)•Standardization of services•Self-service provisioning•Capacity reservation•User access from any geo: “Service locally, manage globally”

Benefits:

•Reduced cost and capital•Reduced complexity•Improved service•Reduced redundancies in infrastructure and people

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Case Study: IBM’s Development & Cloud Transformation

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Case Study: IBM’s Development & Cloud Transformation 10

11 Why IBM for Cloud Computing?

IBM can help you today to create business value with Cloud Computing and address organizational roadblocks:

SECURITY. Security was identified in the 2009 IBM Global CIO Survey as one of the critical factors for cloud implementation. IBM has invested billions to develop the hardware and software technologies and services capabilities to help ensure that your cloud implementation--whether hosted internally or through IBM--has the highest degree of security governance, risk management and compliance across users and identity, data and information, applications and process, network, server and end-points as well the physical infrastructure.

INTEGRATED & OPEN. IBM recognizes that to implement and operate a cloud infrastructure which provides business value requires integrated capabilities in a number of areas including service management and life-cycle management. IBM also recognizes cloud platforms are diverse and open standards are critical. IBM has been a leader in not only delivering integrated capabilities but also driving Open Standards. IBM continues to invest in cloud related technologies and work to drive new standards in key areas including virtualization, security, common interfaces, and management.

EXPERIENCE. IBM has worked with hundreds of customers and implemented a Cloud solution as a vital component of its own business operations. This broad industry expertise and experience gives IBM a unique perspective on how to help organizations identify which specific workload(s) will provide the most business value over time whether it is a PUBLIC CLOUD with collaboration & conferencing, help desk, desktop or storage OR PRIVATE CLOUD with a data & text mining, analytics, security or business continuity workload OR even a Dev/Test workload which may be appropriate in either a public or private cloud.F

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Why IBM for Cloud Computing?

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Why IBM for Cloud Computing?11

12 Overcoming Roadblocks

WHITEBOARD BEST PRACTICE

• When presenting, check off the Business Environment or IT Challenges which are most important to the customer.

• Speak to Customer Examples that meet challenges

In addition to our internal success, IBM has worked with 100s of customers to create value through Cloud Computing--whether through public cloud services or working with the customer to establish a private or hybrid cloud.

These customers have been able to remove key roadblocks. [DRAW GREEN ARROW and refer back to customer examples]

What sets IBM apart from other providers is that IBM provides technology (software and hardware) which can provide the dynamicinfrastructure that is required for supporting a private, public, or hybrid cloud environment as well as the services expertise and experience to help identify the appropriate first steps or assist an IT organization to design and implement in-house approach.

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OVERCOMING ROADBLOCKS EXAMPLE:Higher Quality Services –Doing More with Less-Breakthrough Agility

As we saw in the SKT customer example with a Cloud Computing environment SKT was able to develop and deliver new services to their customers more rapidly, while at the same time reducing the cost of their environment.

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12 Overcoming Roadblocks

13 Next Steps

WHITEBOARD BEST PRACTICE

The key is to identify the NEXT steps with

• Specific timeframes• Identification of the people

you should be working with• Desired Outcomes of Next

Step

[Review the objectives that you outlined and make sure that you have covered the objectives. Check off the objectives.]

Based on what we have discussed today there are several different activities we can look at as next steps:

PLAN-DEVELOP STRATEGY. IBM can work with you and your team to set up and conduct a workshop which can help you to determinehow to proceed forward in developing a Cloud Strategy which includes assessing workloads, delivery models and which workloads, applications or services make sense to move to cloud delivery.

BUILD / “GET CLOUD READY“. IBM can provide the services expertise to help design and implement a plan to "get your infrastructure ready to implement a cloud environment" and helping you to put in place a "next generation" data center which can provide more cost effective and efficient IT services.

DELIVER / PILOT. IBM can assist in helping to define and put in place a "cloud computing" proof of concept or pilot of a specific workload.

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13 Next Steps

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Final Cloud Whiteboard (Customer View)