How XaaS Brings Cloud Benefits to the On-Premises Environment

Many people assume that the “cloud” and the “as-a-Service” model are synonymous. When you use a Software-as-a-Service solution, for example, you are consuming an application that resides in somebody’s cloud. Infrastructure-as-a-Service and Platform-as-a-Service may be hosted in a public or private cloud, but the cloud technology architecture is the common denominator.

At its core, however, the as-a-Service model is more about how the technology is utilized rather than where it is deployed. It is a consumption-based model that enables organizations to eliminate investments in depreciating assets and gain a flexible, scalable, future-proof IT environment.

This fact is manifested in the Everything-as-a-Service (XaaS) trend. Today, organizations can procure everything from servers to storage to networking in a monthly, pay-per-use arrangement. Increasingly, these XaaS solutions comprise bundles of hardware, software and professional services.

Several IT vendors have accelerated their transition to an XaaS model over the past year. HPE announced in June that it would offer its entire portfolio of products via its GreenLake pay-per-use model by 2022. The Dell Technologies Cloud Platforms announced in April enable customers to consume Dell solutions as-a-Service in their on-premises environments.

Cloud services have highlighted the benefits of shifting IT costs from capital to operational budgets. However, the cloud is not a panacea — certain applications and services have to remain on-premises. XaaS enables organizations to keep workloads on premises while still taking advantage of the OpEx model. Additionally, a Deloitte study found that XaaS can enable cost savings, particularly as an organization becomes more mature in its use of XaaS and as more of the IT environment is transitioned to XaaS.

But that’s not the only value of XaaS. In fact, the greatest benefits lie in a flexible, value-driven approach to IT solutions:

• Products become services, and services become products. IT hardware delivered as-a-Service typically includes capacity planning services, and ongoing monitoring and management to ensure that SLAs are met. Operational services can also be included in the monthly fee.
• Solutions are outcome-driven. With XaaS, customers aren’t buying a box — they’re buying a business result. There’s an expectation that the vendor will package the offering in a way that addresses the desired outcome, and continuously optimize the solution to drive ROI.
• Agility and innovation are key to the value proposition. Organizations should adopt XaaS with eye toward becoming more agile and responsive to changing business requirements. IT can become less project-driven and more product-driven, delivering new services more rapidly and implementing innovate solutions with minimal risk.
• Vendors are invested in customer success. The cost of delivering XaaS is front-loaded, so customer retention is paramount. Vendors have a vested interest in providing responsive customer service and ensuring that the solution is successful.

XaaS is not without challenges and risks. In the Deloitte study, 45 percent of respondents said they had difficulty predicting XaaS costs, and 44 percent said they were continuing to pay for duplicative IT infrastructure and XaaS. Integration and interoperability are also issues — 40 percent of respondents said they had difficulty integrating various XaaS solutions, and 39 percent had trouble integrating XaaS with the traditional IT stack.

That’s why partnering with a solution provider such as Technologent can be valuable in the transition to XaaS. We can help you develop cost models and metrics for evaluating XaaS solutions, and assist with integration and the retooling of operational processes. Let us help you extend your cloud model by taking full advantage of the financial, operational, technical and business value of XaaS.