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Project Management on Cloud Computing

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|Cloud Computing |

Corporate Memo

To,

The Executive Committee

Sub: Cloud Computing Arrival

The cloud is here, but better exploitation of cloud computing will require improving IT cost transparency management practices to prevent overspending on IT, manage decentralized IT spending, and enable sustainable shared IT service organizations. There is considerable ambiguity in many enterprises about how to financially approach the cloud at the highest levels within IT and in corporate finance.

In its various forms, cloud computing has the potential to radically change the way IT organizations budget, fund, charge back and manage IT spending and staff. From an economic perspective, cloud computing is a direct response to an IT marketplace that is addicted to "speed and quality" in enterprises that need a shift in focus to "cost and business value." Because the expectations of IT services have not been managed well throughout the years, there is now a gap between internal client expectations for service levels and the ability of enterprises to pay for this level of service. For 2011, the worldwide market forecast for public cloud is estimated at $89 billion, with a five-year compound annual growth rate (CAGR) of 19%. Compared to the forecast for all IT marketplaces in 2011 of $2.6 trillion, cloud represents only 3.5% of the IT marketplace and is forecast to represent 5.9% in 2015. Before the economic downturn of 2008 and 2009, the cloud computing marketplace was a "solution looking for a problem." Now, cloud computing is a set of IT services that can help many IT leaders reach new IT spending targets.

Many enterprises are faced with market conditions where excess capacity is being reduced, because market

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