Zipcar = Cloud Computing

No, not exactly. But they actually do have a lot in common in that they are both about sharing resources and using them to achieve cost-savings and flexibility.

An article in Fortune Magazine (September 14, 2009) on Zipcars really got me thinking about this.

With cloud computing, we are sharing our IT infrastructure, storage, and/or applications with others and using the services of cloud providers. It is one big virtual environment, where instead of everyone having their own technologies and applications, we make use of shared resources and we meet our information technology needs on demand and pay only for what we use.

Zipcars has the same-shared model as the cloud, and shifting toward this new paradigm is going to help preserve the environment.

Usage: Like cloud computing, Zipcars provides for the use of automobile when you need one and you pay by the hour or day, according to what you use. It’s flexible, saves money, and cuts down on the number of vehicles on the road and therefore on the pollution associated with them.

Cost: Both Zipcars and cloud computing cost pennies on the dollar. For a basic $50 membership and $11.25 an hour you can drive a Zipcar (note: drivers who give up their own cars save an average of $800 per month). For 12-25 cents per month you can store a gigabyte in the cloud or for 10 cents-$1.25 an hour you can process tasks on the Elastic Computer Cloud (EC2).

Functionality: Zipcars move people around and cloud computing moves data.

Centralization: Zipcars are co-located in “company created ‘pods’ or group of cars in parking lots or garages,” and cloud computing services are centralized in data centers of large cloud providers (like Google, Amazon, Microsoft, and IBM)

Market: Zipcars has grown already to 325,000 members and is growing 30% a year with a overall market for shared vehicles expected to balloon to $800 million over the next five years (Fortune), and business IT spending on cloud computing is expected to rise from $16 billion last year to $42 billion by 2012 (IDC).

Users: Major companies (not just individuals) are using Zipcars—so far “about 8,500 companies have signed up, including Lockheed Martin, Gap, and Nike.” And brand name companies are signing up for cloud computing, such as NY Times, NASDAQ, Major League Baseball, ESPN, Hasbro and more. (http://www.johnmwillis.com/other/top-10-entperises-in-the-cloud/).

Going green: Each shared Zipcar “takes up to 20 cars off the road as members sell their rides or decide not to buy new ones.” Each move to cloud computing makes some or all of organizations unique servers, storage devices, and applications obsolete.

The trend: With the transportation market, the future will be “a blend of things like the Zipcar, public transportation, and private car ownership (according to Bill Ford), and with the IT industry, the future will be a combination of cloud computing, managed services, and in-house IT service provision.

Zipcars and cloud computing are benefiting from the new shared services model driven by cost-savings, flexibility, efficiencies of allotment, and eco-consciousness. These are driving change in our usage of transportation and computing for the better.

Zipcar = Cloud Computing

What Goes Around Comes Around and Enterprise Architecture

As an enterprise architect, I have always wondered about the trend of outsourcing our manufacturing jobs out of country-- where as a nation we erode our manufacturing base and ship this capability to China, India, Mexico, and other countries where labor is plentiful and cheap.

Yes, in the short term we are taking advantage of the lower costs of manufacturing in other countries, but long term, I always questioned the viability of this strategy thinking that surely every nation needs to maintain a core of critical manufacturing and service capabilities and infrastructure to guarantee self-sufficiency, protect itself from eventual global disruptions, and ensure the continuity of its existence.

I believe that some day (and maybe relatively soon), we will regret the near-sightedness of our decisions to move production abroad for the sake of the dollar today.

Interestingly enough, I read in the Wall Street Journal today, 13 June 2008, that “stung by soaring transport coasts, factories bring jobs home again.”

“The rising costs of shipping everything from industrial-pump parts to lawn mower batteries to living-room sofas is forcing some manufacturers to bring production back to North America and freeze plans to send even more work oversees.”

I thought to myself—Hallelujah!

No, I am not happy that oil prices are soaring and that inflation is looming everywhere, but I am cautiously relieved that perhaps, we as a nation will wake up in time to secure our economic interests at home and not send our entire manufacturing base and capabilities out of country.

Ironically (da!), the further we move our factories away, the more it costs now to ship the goods back home.

“The movement of factories to low-cost countries further and further away has been a bitter-sweet three-decade long story for the U.S. economy, knocking workers out of good-paying manufacturing jobs even as it drove down the price of goods for consumers. But after exploding over the past 10 years that march has been slowing. The cost of shipping a standard 40-foot container from Asia to the East Coast has already tripled since 2000 and will double again as oil prices head toward $200 a barrel…In the world of triple-digit oil prices, distance costs money.”

The other thought that always kept coming to mind was that as we continue to move manufacturing abroad, the increasing demand for labor would drive the cost of labor up, and eat away at the cost differential making the overseas move a moot point.

Again, I read today in the Journal the story I always felt was bound to be told and to continue to unfold: “The cost of doing business in China in particular has grown steadily as workers there demand higher wages and the government enforces tougher environmental and other controls. China’s currency has also appreciated against the dollar…increasing the cost of products in the U.S.”

One problem with trying to bring the jobs back home…

“Much of the basic infrastructure needed to support many industries—such as suppliers who specialize in producing parts or repairing machines—has dwindled or disappeared.”

What goes around, comes around. The jobs (some) are coming home (although net-net, we’re still losing manufacturing jobs). As a country, we‘ve benefited in the short-term from outsourcing, but in the long-term, I believe we’ll have done ourselves a good deal of harm.

Does this sound unfamiliar?

Think national deficit—big time. Think gargantuan problems with social security, Medicare, health care, and so on.

All too often, we behave with short-sightedness and like infants, the desire for immediate gratification. But as enterprise architects, I believe we need to think long term and often defer gratification for long-term competitiveness, self-sufficiency, and survival.

What Goes Around Comes Around and Enterprise Architecture