Dan Greller, managing director at Legg Mason, was one of the expert panelists participating in the Smart Enterprise Exchange live, interactive discussion on November 11. He is also a member of the Exchange.

Along with subject matter experts, Timothy Chou and Dave Hansen, Dan Greller discussed the Public Cloud from his perspective as a long-time finacial services IT executive. Many questions were sent during the broadcast and here are a few that Dan answered personally for attendees... Members are welcome to add your own comments or personal experiences as well. To view the full webcast, register here and for more about the webcast, read the blog here.

Question from Vlad Ostrovsky, IBM: What elements of cloud service management need to be in place for a company establishing a public cloud presence?

Dan Greller: In general, you should start with the same set of practices you use for service management in your current environments --internal and external. The relationship you would have with public cloud providers would most resemble existing relationships you have with non-cloud based service providers (i.e. traditional outsourcers). Anything you are doing in that space should serve as a starting point.

An important distinction would be whether the provider you are evaluating is SaaS, IaaS or PaaS. In the case of SaaS, the service should be more distinct and provide “cleaner” management metrics. It also should be more of the provider’s responsibility to supply you with those management metrics. In the case of IaaS/Paas, the services can be more fluid and the management metrics a bit hazier. In any case, the classic service management basics should be in place. That is, there should be a defined process around performance, availability, incident management and chargeback.

Question from Shahin Razavi, Cisco: What do you need to take to your CFO to get the funding for developing cloud offerings?

Dan Greller: I’m assuming that by “developing cloud offerings” you mean to moving traditional IT services to a cloud-based model. I believe this should be approached the same way you approach the funding process for any major project. That is, you should provide the same justifications you normally offer around revenue-enhancement or cost reduction.

However, you should start by considering the nature of the service you are proposing. Is this a service that you don’t currently provide internally? Therefore, the cloud could be justified as a means to more quickly establish a capability (i.e agility). Is the service being considered because you are at a major decision point regarding Capex (data-center expansion)? In that case, your justification should involve the benefits of moving costs from Capex to Opex. Other intangibles that your CFO should be aware of include the ability of IT management to better focus on business transformation instead of administration and support when services are hosted.