June 29, 2012

Cloud computing is one of the most important trends in business today. But does it affect the business world only? No. Cloud-based solutions offer great potential especially for education and research institutions, enabling them to better cope with increasingly growing data volumes and the requirements of global research networks of companies and other economic agents working simultaneously across different time zones. Find out more about both the potential and the challenges …

Progress with information technology is being made particularly in academia and science as these sectors are undergoing fundamental changes: many researchers at universities are working in close and mostly project-based collaboration with a growing number of partners from both the academic and the business world. This poses entirely new challenges for information systems. In global cooperative research endeavours, for instance, growing data volumes need to be processed rapidly and reliably. Also, universities are faced with the more sophisticated demands of a new generation of researchers and students. These “digital natives” are naturally savvy in dealing with modern information and communication technologies and their latest applications. Given this background they expect to have state-of-the-art infrastructures at their disposal for research and learning.

Hence, academic and research institutions are the pioneers and melting pots of an emerging knowledge-based information society. These institutions are now going through changes that will shape the business world and society as a whole in the 21st century. Important aspects in this context are not only the processing of a swelling flood of information, the creation of knowledge from information and the validation of information, but also easy access to innovative learning modules via the internet.

Cloud computing can make valuable contributions to help solve these issues. Several pilot projects, such as the US internet2 consortium, have shown that flexible provision of IT capacities is well-suited to the requirements of international collaboration across different time zones. Cloud solutions can also help universities and economic agents to integrate users with their own individual access technologies (“bring your own device”, BYOD). In the age of tablets, smartphones, mobile apps and ever new solutions this is more of a staple than a luxury and extremely attractive to users.

However, for today’s typical university, cloud-based solutions also offer the chance to integrate the often fragmented IT landscapes of central administrations, faculties, special research areas and departments, enabling them to work together efficiently. This means that research and teaching material can be provided to an interested clientele in very different ways. Entirely new support infrastructures are emerging. These will help scientists and business people to tap the potential of knowledge-based collaboration for instance by joint development of new technologies, processes and services on the basis of open teaching sessions or research projects. IT infrastructure landscapes are changing, also bringing about changes in structures and management systems. It is conceivable that the widespread use of cloud computing will also turn campus management systems, learning management systems (exam administration) and virtual collaboration spaces for researchers, teachers and students into a natural criterion for university IT management.

But despite all this potential, cloud computing is not only lined with silver. All the promising advantages are also set against considerable challenges at the technical, legal, business and organisational levels. Major issues in this context are optimum utilisation of the IT capacities on offer, contractual relationships that are often hard to pin down, risks regarding data protection and data security as well as potential economic frictions resulting from an automatically tight and long-term commitment binding the user to a cloud provider (“lock-in”).

To tap into the considerable potential of cloud computing, the education and research sector – like the business world – urgently needs rules and regulations as well as a new generation of competent IT specialists. These will then have to work as managers keeping a watchful eye on structural change, checking long-term feasibility and negotiating required service levels.

When implementing cloud computing solutions in the world of academia and science, banks are not only welcome – already today – to provide financing but also as a sparring partner in discussions. Banks have already looked in greater detail into the opportunities and risks of IT outsourcing – of which cloud computing forms a part. They have gathered valuable experience in terms of the design of a contractual framework (especially regarding service level agreements, SLAs), regulatory requirements and governance. Looking ahead, such partnerships could be intensified. This is true in particular regarding the issues of trustworthiness, certification or – further down the line – also regarding trade in (cloud and information processing) capacities.

Cloud computing solutions thus offer some potential for helping to shape the requirements of a modern information society, which today are particularly important in research and education as well in a knowledge-based economy. Investment in the continuous expansion of IT infrastructure and IT competences of universities and companies is not only necessary but also offers the potential of helping small and medium-sized enterprises (SMEs) collaborating with universities to open up totally new possibilities (in the scope of cooperation with scientific and teaching institutions) through a project-economy approach.

It is to be hoped that the considerable IT investment in the area of academia and science (investment in German university computer centres alone came to approx. EUR 500 m in 2010) will be tackled by adopting some of these solutions. It is also to be hoped that – as in the case of the internet2 consortium – software and telecommunications companies will enter into a process of dialogue and learning with universities to work out the best solutions for individual requirements based on experience and learning. In the global race for excellence and skilled labour and in the increasingly knowledge und innovation-based economy this will be another factor determining the competitiveness of universities and businesses.

See also

• Rollwagen, Ingo (2010). Project economy approaches for higher education: diversifying the revenue base of German universities. Higher Education Management and Policy, Volume 22 Issue 3, Paris.

• Heng, Stefan and Florian Schüler (2011). Cloud Computing: The term will disappear, but the idea will continue to catch on. Deutsche Bank Research. Talking Point. Frankfurt am Main.

• Heng, Stefan (2012). Cloud computing: Clear skies ahead Deutsche Bank Research, E-conomics. Frankfurt am Main.

• Lamberti, Hermann-Josef (2.2.2012). Frankfurt Cloud stärkt Innovationskraft des Finanzplatzes, Börsenzeitung – special edition.

• Rollwagen, Ingo (2012). The global race for excellence and skilled labour: A status report Current Issues. Deutsche Bank Research. Frankfurt am Main.