It is said that cloud computing is improving business agility because of the ability to rapidly and inexpensively provision technological infrastructure resources on a pay-per-use basis. So customers are urged not to buy and own hardware and software for themselves but instead they should make use of cloud computing services that are offered by the cloud computing providers.
To put it another way, what is the point of owning hardware and software? Because the only thing you want to do with it is using it at the time you need it. The cloud computing proposition of on-demand delivery on a pay-per-use basis more or less removes the necessity to possess hardware and software.
But is this XaaS wisdom, “X-as-a-Service” as preached by the cloud computing providers also used by them selves?
An datacenter is an assembly of software, computer servers, storage, networks and power and cooling/air handling components. With these means the cloud computing provider assembles its cloud computing services. But is there a need for these providers to own these components?
Can a datacenter and thus a cloud computing proposition be assembled by a set of software, computer servers, storage, networks and power and cooling/air handling services provided by third parties?
The emphasis on services rather than goods is a central idea of the new industrial model, circular economy, that is now gradually taking shape.
Circular economy draws a sharp distinction between the consumption and the use of materials. It is based on a ‘functional service’ model in which manufacturers retain the ownership of their products and, where possible, act as service providers—selling the use of products, not their one-way consumption as in the current industrial model of linear economy. In this new industrial model the goal of manufacturers is shifting; selling results rather than equipment, performance and satisfaction rather than products.
An example of this new approach is Philips, the global leader in LED lighting systems who has recently closed a deal with the Washington Metropolitan Area Transit Authority (WMATA) to provide 25 car parks with a LED lighting service. Philips will monitor and maintain the lighting solution based on a lighting-as-a-service model (Pay-per-Lux model).
As expressed by Philips the implications from a business process perspective are profound. Out the window goes the traditional, linear approach to resource use: namely, extract it, use it and then dump it. Instead, management focus turns to principles such as re-manufacturing, refurbishment and reuse.
Another example is InterfaceFLOR. As part of their drive to increase the inherent level of sustainability of their business, they do not sell the carpet as a product, they lease it as a service. That is supply, install, maintain and replace the carpet.
Walk the talk
Back to the cloud computing provider. Why bothering on the life cycle management of all the components you need? Why the burden of managing the buying, installing, maintaining, replacing, decommissioning processes?
Why not doing what you preach to your customer and start using the X-as-a-Service model for your own needs?
See also the blog post Data centers and Mount sustainability or if you want to know more on circular economy download a free copy of the book SenSe & SuStainability from the Ellen Macarthur foundation