In last week’s Retail Paradox Weekly review of the NRF 2012 event in NYC, I made the observation that:

As is so often the case in a buzzword happy industry, the NRF exhibition floor was awash with ‘Cloud’ this-and-that. Like buzzwords of the past, the term is so often overused-and-abused that it has lost all meaning… 2012 should be a good year for one thing: as retailers seek to take advantage of ‘the cloud’, the marketplace will separate the wheat from the chaff, and there won’t be so much noise about it at NRF 2013.

This prompted an immediate (and hopefully jocular) response from my friend and fellow standards advocate Richard Mader, Executive Director of the NRF ARTS Standards Committee, who exclaimed, “How dare you … without (adding that) ARTS can help with Cloud Whitepaper and RFP to select services???????? We had a lot of folks come to ARTS booth to learn more about Cloud. ” Of course, I needed to check to make sure I hadn’t burned a bridge (after all, retail may be a big business, but it is a very small community!), so I called Mr. Mader about what ARTS is doing to help retailers understand and realize the value of cloud computing as an IT services delivery model.

‘Cloud’ Defined

“Almost two years ago “, Mader explained, “we released a paper that talked about what is ‘cloud computing’ and how it might be used in retail. We called that ‘the cloud whitepaper’. Then what happened is, people came over to the NRF ARTS pavilion (at the 2010 trade show) and said, ‘That’s nice, but how are we going to know how to select the right services?’ So then we developed an RFP, and last January, we issued version 1 of an RFP that helped you select infrastructure as a service. In July we expanded the RFP to cover infrastructure, platform, and application. The template is a series of questions that will help you when dealing with vendors to validate the key points of reliability, security, etc. We think those are two good guides for retailers who are walking down the ‘cloud’ path. “

What had originally triggered my comment about cloud this-and-that in last week’s Retail Paradox Weekly was one vendor’s claim that “we have been delivering cloud-based applications since 1980 ” (you can’t make this stuff up!) — a claim that Mr. Mader laughingly equated with a claim that Al Gore invented the Internet. But the ARTS white paper, which was developed with the assistance of such technology companies as Cisco, IBM, Microsoft, Oracle, and Verizon, and retailers like Lowes, Kroger, BJ’s Wholesale, and the UK’s Royal Mail, has a concise definition of what cloud computing really is:

Cloud computing is an emerging computing model by which massively scalable IT-enabled computing capabilities and resources (servers, storage, networks, applications, and services) are delivered as a service to external consumers using Internet technologies. By utilizing both efficient IT service management and a business-centric approach, IT resources and services can be dynamically and rapidly deployed at a significantly lower cost than through traditional mechanisms.

Cloud computing has the following characteristics:

The RFP

As already mentioned, the ARTS group has developed a standardized RFP to help retailers make smart decisions about cloud-based offerings. Similar to other RFP standards that the group has developed, its purpose is to help retailers ask the right questions of vendors who claim to deliver cloud based solutions. The workbook includes a set of comprehensive questions to cover the most common concerns about cloud technology including: Security, Audit and Compliance, Performance, Availability and Support, Reliability, Migration, System Software, Monitoring, Manageability, Interoperability, and Capacity and Scalability.

So, who would use such a tool? Explained Richard, “Big retailers always have the money to research solutions, but smaller companies want to understand the concept and how to use it securely- they are the companies that can be taken advantage of. But people are definitely moving towards cloud. We’ve seen companies implement mobile solutions on cloud services as far back as 18 months ago, because it’s expandable and a reasonably quick way to get started. “

Separating the Wheat from the Chaff

While standing by the comment that 2012 will be a key year when real cloud-based solutions providers will begin to win market share, retailers don’t have to wait for the dust to settle to start down the path of considering it as a viable option for upgrading their IT portfolios. Mader and the ARTS Committee have tried to take some of the risk out of the option for retailers.

One of the promises of cloud-based solutions is that they move the retailer past the not invented here syndrome when it comes to business applications. There are plenty of commercial applications that are flexible enough to service different retailers’ needs on an on-demand basis. What Richard Mader and company offer is a way for retailers to also avoid the not invented here syndrome when it comes to developing the request-for-proposal. For the price of a membership, the ARTS template is free.

[1] Cloud Computing for Retail, Version 1.0.0, Dec 12, 2009, Copyright © 2009 ARTS. All rights reserved.