Cloud Computing and SOA Convergence in Your Enterprise: A Step ...

Defining the Holistic Value 67
Make sure you consider these items when costing out a cloud computing
solution. Some will not make much of a difference, some are very significant.
These costs are very enterprise and domain dependent.
Preserving Capital
What the heck is capital As defined by Wikipedia, it is
any liquid medium or mechanism that represents wealth, or other
styles of capital. It is, however, usually purchasing power in the form
of money available for the production or purchasing of goods, et cetera.
Capital can also be obtained by producing more than what is
immediately required and saving the surplus. 1
In other words, it is money in the bank that allows the business to run.
The more money we have in the bank, the more we can purchase things for
the core business, such as inventory that can be sold or new plant equipment
that will save the company money during production. It is good to keep as
much capital as possible on hand to invest in the business instead of into infrastructure
such as data centers, hardware, and software.
Considering the example case study, if we need to conserve capital, then
cloud computing seems to be the way to go. We pay as we use the service,
there is no hardware and/or software to buy, and we can keep the money in
the bank for other purposes. There is a clear value that you can assign to the
preservation of capital, which is largely dependent on the business and needs
to be considered with this analysis.
The benefits of preserving capital are significant. Startups can launch an
entire company with almost no IT expense, new divisions can be created
with little IT capital investment, and there is no need to reinvest in hardware,
software, and data center resources as the business scales up. Moreover, there
is no reason to keep those capital resources around as the business scales
down. With cloud computing, it is just a matter of paying more, or less, for
the use of the service. We can call this the value of upsizing and downsizing
on demand.
1. http://en.wikipedia.org/wiki/Financial_capital