The New Business Operating System:Combining Office 365 and the MicrosoftCloud Ecosystem to Create Business ValueDate Published: October 2014Authors:Pete Skelly, Director of Technology, ThreeWillContributors:Sean Hester, Senior Research Engineer, ThreeWillTommy Ryan, President and Co-Founder, ThreeWillJohn Underwood, Technical Evangelist, ThreeWillReviewers:Eric Bowden, Principal Consultant, ThreeWillKirk Evans, Architect, Microsoft CorporationGary Geurts, Director of Client Solutions, ThreeWillKaree Lang, Director of Information Technology, Turner Broadcasting System, Inc.Kirk Liemohn, Principal Software Engineer, ThreeWillCharles McCann, Software Development Manager, ManheimMike Schubert, Sr. Manager, Portal Development, McKessonCole Shiflett, Web Technologies Lead, ARRIS Group, Inc.

AbstractThe o i atio of Offi ea d Mi osoft s Cloud E os ste is the asis fo a new business operatingsystem. Businesses can consume base services such as email, unified communications, content managementand collaboration sites, file storage, search, etc., and combine them with cloud or on-premises virtualizedresources and custom applications. The New Business Operating System (NBOS) enables businesses to leveragecommodity based IT Services and enables customizations to enhance business value. ThreeWill expects that thisNBOS will be the collaboration platform of choice for many companies – from small businesses to largeenterprises. What excites ThreeWill most is the extensibility of NBOS that will allow companies to worktogether better. In this document we will provide guidance, review the challenges, offer insights, and describewhy we are firm believers in the NBOS.AudienceThe audience for this white paper is CIO s, CTO s, IT P o s and Solution Architects. The information in thiswhitepaper is technical in nature and is designed to inform technical buyers, decision makers, IT servicemanagers, and solution architects. CIO s a d CTO s: Learn how to support your business strategy and maximize return on investment withthe combination of Office 365 and the Microsoft Cloud EcosystemIT P o s: Learn how Office 365 and the Microsoft Cloud Ecosystem can enable and run business solutionsin a cost effective, supportable and customizable way with a single control surface.Solution Architects: Learn how Office 365 and the Microsoft Cloud Ecosystem can enable the design anddelivery of custom solutions that provide maximum business value.2

Abstract .2Audience .2Why this Paper?.4A Brief History Lesson .5Phase 1: Creating Collaboration Portals .5Phase 2: Customization .5Phase 3: Moving to the Cloud .6Phase 4: The Future of Office Development .7The Business Impact of a Cloud Ecosystem .8The Business Impact of Continuous Delivery . 10The Co pou d Effe ts of Moo e s La a d Cloud Co puti g . 11Moving to the Cloud On Your Own Terms . 11The New Business Operating System . 14Three Perceived Barriers to the New Business Operating System . 16Compliance . 16Control . 17Customization . 18Focusing on Business Value . 19Defining Your Business Cloud Profile . 19Top 5 Benefits of the New Business Operating System . 22Reeds Law and the New Business Operating System . 23New Business Operating System Case Studies . 25Case Study: Popcorn . 25Case Study: Seasonal Staff Management Web Portal . 26Case Study: Pointer for iOS. 26Case Study: Hybrid Office 365 and On-Premises Solution . 26Conclusion . 27Next Steps. 28Bibliography . 293

Why this Paper?The release and growing adoption of Mi osoft s Office 365 and SharePoint 2013 offerings have served togenerate anxiety and uncertainty in organizations that have made significant investments in SharePoint. Thisanxiety and uncertainty has slowed, and even stopped, strategic investment in SharePoint by some businessdecision makers. Combined with the reduced strategic adoption and customization efforts, a wide array ofcontentious content has been generated in the SharePoint IT Pro and developer communities. The content andconversations have typically been negative responses to SharePoint s transformation from a license based, onpremises only product to a cloud and on-premises offering.Enterprises who have strategic investments in SharePoint must now u de sta d ho Mi osoft s Mobile First,Cloud First strategy impacts their investment. Mi osoft s cloud enabling technologies span public (MicrosoftAzure), private, and hybrid (the Microsoft Cloud Ecosystem) scenarios. ThreeWill contends that the combinationof Office 365, SharePoint 2013, Microsoft Azure and the Microsoft Cloud Ecosystem is the New BusinessOperating System (NBOS). However, strategicall alig i g ith this e Mo ile Fi st, Cloud Fi st st ateg canseem daunting to most enterprises. The myriad of options, architectures, financial impacts and potentialcustomizations are the root of great concern for many enterprises. Increased integration points and a perceiveddecrease in control concerns IT and operations teams. Development teams are concerned that 10 years ofaccumulated expertise is no longer valuable or viable to their organizations, or the market at large.This whitepaper is an attempt to describe and address some of the challenges faced by enterprises when movingto the NBOS. We will provide an overview of the cu e t Ma age e t of Cha ge MoC) challenges regardingSharePoint 2013 and provide guidance and insights to how enterprises can derive business value from the NBOS.Some industry pundits pai t Sha ePoi t s future as bleak. ThreeWill believes these changes present compellingopportunities. We view the combination of the NBOS (Office 365, Microsoft Azure, and the Microsoft CloudEcosystem) and the new cloud development models as a disruptive innovation that will enable enterprises tocreate collaborative solutions that help organizations Work Together Better.4

A Brief History LessonTo best understand the source of so e of the a iet a d u e tai t , let s take a look a k at Sha ePoi t shisto . Sha ePoi t is o i its fifth e sio . I the ti e si e itselease, Sha ePoi t s histo a emarked with four major phases.Phase 1: Creating Collaboration PortalsThe original vision of SharePoint largely relieved the overworked IT staff from the burden of provisioning inwardfacing intranet sites. As internal departments clamored to have their own website, IT staff had to be intimatelyinvolved in the building of content. Ultimately, the technical staff was simply unable to keep up with thedemand. SharePoint shifted the value of provisioning sites and creating content to the business user. It alsoprovided the basic list, document management, and search capabilities that are the cornerstone of the productto the current day.Phase 2: CustomizationWith the release of the second version of the product in 2003, a third-party developer community began toform. These products often took the form of software components (known as Web Parts) that empowered endusers to create lightweight applications. Additionally, the concept of mashing up data from sources inside andoutside of SharePoint started to take shape.The 2007 release of SharePoint was a significant step forward. The advances in branding, customization, andability to use SharePoint as a development platform were reasons ThreeWill focused our business onSharePoint. However, many tasks were still more cumbersome than necessary.The SharePoint 2010 release was another sig ifi a t elease i the p odu t s e olutio . Sha ePoi tprovided viable options for customization and branding. Ultimately, SharePoint 2010 represented the mosti po ta t poi t i Sha ePoi t s histo . The p odu t ould e used ot only as a productivity tool forinformation workers, but as a platform upon which companies could build business process integrations. Themarket penetration and enterprise implementations continued to rise, but there was still a significant gapbetween SharePoint 2010 and Software as a Service (SaaS) based applications, web frameworks and solutions.5

Phase 3: Moving to the CloudBy 2012, consumers and enterprises had grown accustomed to cloudbased applications, with shortened software feature release cycles,subscription-based software, and cloud-based virtual environments.Mi osoft s elease of Sha ePoi tmade a bold declaration oftheir intentions to drive SharePoint as a subscription-based service viaOffice 365. SharePoint 2013 represents a cloud-first model whereupdates and innovations come to the cloud first, fast, and sometimesexclusively.This cloud first, subscription based model has two significantimplications. First, the cloud-based model introduces a completelynew programming odel fo Sha ePoi t: the App odel(Microsoft, 2014). Interestingly, the App model applies to MicrosoftOffice applications (Outlook, Word, Excel, and PowerPoint) as well.Simply put, the App model enables custom code to execute outside ofMicrosoft managed processes see What is the App odel? sidebar). The App model enables a user s web browser or external servers(including non-Microsoft technologies) to enhance and extend Officeand SharePoint applications. This out-of-process model was arequirement to enable Microsoft to deliver on the Mo ile Fi st, CloudFi st st ateg and to increase stability of the platform for on-premisesenterprise customers. In the end, the App model provides thecapability to deliver a consistent application experience inside OfficeApps (Office and SharePoint apps) in the cloud, and on-premisesacross multiple device formats. If Office 365 is the heart of the NBOS,and the Cloud Ecosystem is the brain, then the new App Model is thelifeblood for providing business value on top of the NBOS.6WHAT IS THE APP MODEL?Apps fo Offi e a d Sha ePoi t a e asedon a new application model which shares acommon approach for extending Office andSharePoint. It brings the value of apps weknow on devices to the productivityapplications you use on a daily basis.This new apps model is built on webtechnologies like HTML, CSS, JavaScript,REST, OData, a d OAuth. If ou re a webdeveloper, you can use your existing skills tobuild apps and take advantage of familiartools, languages, and hosting services. Youcan deploy, update and maintain your appsfaster in the cloud and finally publish andsell your apps on the Office Store, ordistribute IT-approved apps within yourorganizations by using a corporate Appatalog. To e,

Phase 4: The Future of Office DevelopmentWhat is the future of Office and SharePoint solutions development based on Sha ePoi t s collaboration roots,evolution into a platform for custom solutions, and the radical shift to a new application model? Short term, thechanges represent significant learning and adoption challenges for the Office and SharePoint IT pro anddevelopment communities. Some very visible thought leaders in the SharePoint industry – including AndrewConnell (Connell, 2014), Ch is O B ie (O'Brien, 2014), Jeremy Thake (Thake, 2014), Doug Ware (Ware, 2014),Mark Rackley (Rackley, 2014), Joel Oleson (Oleson, 2014) - have openly opined that this new model requiresexploration and discovery to reach new best practices. IT managers and business professionals that depend onSharePoint customizations should expect there to be a measurable learning curve for SharePoint developers andarchitects in the immediate future.In our opinion, however, this new app model represents a very bright future. The new App model isarchitecturally sound and preserves or enables stability, performance, and scalability both in the cloud and onpremises, allowing Office solutions to break out of an e olutio aa k ate (Hester, 2014), and embraceindustry wide best practices for application development. One significant benefit of the NBOS is that the pool ofpote tial ope atio s esou es a d solutio de elope s just g e e po e tiall . Be o i g a Offi eDe elopeo lo ge e ui es joi i g a secret society with arcane rules, deep knowledge of product specificAPI s (application programming interface), and product specific best practices. The NBOS represents asubscription-based set of ubiquitous services, built on a composable, scalable, elastic, location transparentinfrastructure that enables standard, cross platform integration opportunities to benefit the enterprise.7

The Business Impact of a Cloud EcosystemE te p ises a hoose to o su e ultiple est of eed loud solutio s, but competing, or eveno pli e ta , e do s do t fo us oaki g these solutio s o k togethe . Fo e a ple, a o ga izatio smay use Salesforce for CRM needs and for file storage, but still need email, calendaring, and other lineof business applications. Knowledge workers still need all of their tools to be integrated in order to collaborateand provide business value in their daily jobs. Line of business solutions still need to integrate and connect tocloud services, or even on-premises systems. These integrations are critical to solutions that work together toadd value to the business. Unfortunately, most SaaS services provide value for their specific problem domains,but these solutions don't address all of the possible scenarios, specifically custom line of business integrations.Cloud computing is a e o e loaded te , so let s defi e so e te s. For our purposes, the followingdefinitions describe the three categories of services that can be delivered over a network, either private, publicor hybrid.Software as a Service (SaaS) - applications provided as software completely delivered in the internet, consumedby users accessing the software from cloud clients or native clients which access a cloud-based product (e.g.Office 365)Platform as a Service (PaaS) - provides a computing platform and a solution stack as a service, typically built ontop of a provider's IaaS infrastructure (private or public); enables focus on delivery of the application, not themaintenance of the infrastructure on which the application runsInfrastructure as a Service (IaaS) – provides raw infrastructure services (virtual machines, virtualized disks orstorage, networking and management, may include pre-installed / configured bundles with software, e.g. AzureVirtual Machines); requires maintenance, updates and patches be performed by consumer8

Although more specific details of these terms are beyond the scope of our discussion, we will make oneassumption about cloud computing in general: The cost benefits of the cloud are proven and well documented.(CFO Research, 2012).For over 10 years, Microsoft Office applications, including SharePoint, have dominated the business userlandscape. There have certainly been challenges to this dominance, but the dominance of the Microsoft toolsill e ai fo uite so e ti e. The alue of Mi osoft s appli atio s a d platfo s ha e se ed e te p isesand small businesses well, and Microsoft is poised to provide increasing value to customers going forward.The advent of collaboration capabilities that leveraged the consistency of the Office Suite and enabled creating,curating and centralizing content is one of the primary reasons SharePoint enjoys such incredible growth andmarket share. The preceding statements might be argued, but the number of SharePoint licenses and marketpenetration is an objective fact. By most accounts, the total number of SharePoint users exceeds 100 million.9

The Business Impact of Continuous DeliveryFor most enterprises, the historical context of SharePoint is defined by on-premises delivery with softwarereleases based on 3-year cycles. Enterprises have become so entrenched in this release cycle that planningcycles parallel these timeframes. However, the release of Office 365 and Microsoft Azure changed much morethan just these planning and release cycles. (Nadella, 2014)Mi osoft s i t odu tio of Offi ea d SharePoint 2013 products disrupted the enterprise. Yes, many CIOs,IT Pros, and architects knew about BPOS (Business Productivity Online Suite) and were using cloud services likeSalesfo e a d Bo , ut the de elop e t of li e of usi ess appli atio s i side of Sha ePoi t as still sa edground as recently as 2013. Entire teams and considerable expertise was built around the on-premises, inprocess model of SharePoint customization. The impact of the release of Office 365 and SharePoint 2013 can bedescribed in one obvious statement:Mi rosoft’s introduction of Office365 and Microsoft Azure represent a fundamental shiftto continuous delivery for their products and services that impacts feature prioritization,development, delivery, licensing, support, maintenance, and availability among manyother facets.Microsoft s lega li e si g odel will continue to decrease over time. CIO s/CTO s, IT o ga izatio s, a dsolution architects must determine how their use of Microsoft products, including Office 365 and SharePoint,fits in a cloud-based o ld. The Mo ile Fi st, Cloud Fi st st ateg a d introduction of the new App model wasabsolutely necessary, and Microsoft has been executing this strategy quickly. How could there be uncertainty oranxiety regarding the relevance of SharePoint and Office in the NBOS? Shouldn't everyone be jumping for joyover this decision and direction? One would think so, but a review of recent blogs, whitepapers, and socialedia su ou di g Mi osoft s st ateg is less than glowing. It is obvious that Mi osoft s st ateg has disruptedenterprise IT at all levels, causing anxiety and inaction across the enterprise. From decision makers todevelopers, many are asking questions like the following: How do Office 365 and the App model impact our technology strategy?Does this new platform support our strategic objectives?Is our strategy too shortsighted?How must our governance change to operate on this new platform?What new skills are required for me to stay relevant?Is my job safe?10

Although these questions are related to the above statement, the underlying theme to these questions is acorollary to the above statement.Microsoft's shift to a continuous delivery cycle of products and services necessarily andfundamentally changes the way CTO’s/CIO's, IT Pros and Architects will deliver value tothe business.Mi osoft s ha ge to a continuous release cycle is indeed a monumental shift, with far reaching impact in theenterprise. Strategic decisions are no longer concerned with a simple purchase of a suite of product licenses, anEnterprise Agreement (EA) or Software Assurance (SA) agreement, support hours and other typical serviceswhich have an ROI time horizon of the past.The Co pou d Effects of Moore’s Law a d CloudComputingIn general, continuous delivery (updates) to SaaS, PaaS or IaaS offerings is not new, but the impacts as applied toMi osoft s o e usi ess p odu ti it suite a e still e e gi g. The loud has o pletel o e tu ed theenterprise strategic planning apple cart. As Be Hae sle has stated, our ability to plan has beeno p o ised. (Hammersley, 2013) Strategic technical decisions must now account for Moore's Law in waysthat extend far past a PC refresh program, capitalizing server hardware, or planning for new software licensingagreements.Moo e s La postulates that e e8 too ths processors will cost half as much to produce and will be ableto perform twice as many operations. (Mirani, 2014) Businesses could plan on, and take financial advantage, ofthe innovation c les Moo e s La p edi ts. I deed, usi esses ha e i o po ated Moo e s La i to theitechnology strategies for years. The typical business strategy accounted for infrastructure and software updatesaccording to a 2-3 year maximum timeframe. But Microsoft now delivers new features to the cloud (both Officea d Azu e i i e e ts as sho t as eeks. CFO s a d CTO s can no longer rely on strategies with ROI in the3-5 year time. Simply put, the cloud moves e e faste tha Moo e s La .Moving to the Cloud On Your Own TermsSome industry analysts view the decision to utilize cloud-computing as an all or nothing proposition. Theseanalysts have indicated that the question is not if you’re goi g to the cloud, but when. This view ignores a11

number of real-world business challenges and vastly oversimplifies reality. In our opinion, there are two strategicquestions that must be asked to determine a path to the cloud:1. How can your business move to the cloud on yourterms?2. Which cloud provider(s) enable moving to the cloud onyour terms?ThreeWill also believes the strategic considerations should bebroader than simple cost-shifting scenarios.The decision to move to the cloud is about muchmore than computing power or the cost of storage.The decision is about new opportunities –productivity, security, devices, notifications, bigdata, machine learning, on-premises, hybrid andpublic cloud integration.WHAT IS DEVOPS?De Ops is a o i atio of de elop e t a dope atio s . The teefe s to the ou i atio ,collaboration, and integration of software developers,and IT operations personnel to improve productdelivery, quality testing, feature development, andmaintenance releases in order to improve reliability,increase security, and provide faster development anddeployment cycles. DevOps concepts and practices arederived from a combination of the Enterprise SystemsManagement and Agile software developmentmovements.To state this differently, the cloud vendor choice of an enterprise may reduce the ability to pursue new businessodels. With the ad e t of usi ess do ai API s, i te ha gea le se i es, the Internet of Things (IoT), RFID(Radio Frequency Identification), NFC (Near Field Communications), and much more, even small to medium sizebusinesses can derive real value from emerging cloud advances quickly. However, businesses must have aservice-centric IT strategy and the ability to process millions, perhaps even billions, of inputs. Using the NBOS tomove to the cloud incrementally can provide you with the infrastructure necessary to take advantage of newprocesses, devices, sensors, and the accompanying large data sets much more rapidly. The ability to quicklyprovide elastic scale to leverage the proliferation of devices, signals and data specific to your business domainmeans gaining business insight quickly. Gaining business insight more quickly enables innovation and growth.It is not enough to have an infrastructure (IaaS) strategy that re-hosts applications in virtual machines in thecloud (public or private) or to choose multiple best of breed SaaS solutions without an integration strategy.Business cloud strategy must anticipate a work streams future value, and DevOps must enable flexiblearchitectures to deliver, manage and enhance that value over time. In short, business strategy now has to treatthe business value proposition of the NBOS like an operating system – which has a base operating system(Azure/Azure Pack), standard applications (Office 365) and provides input and output options to provide addedvalue immediately, on demand.12

The New Business Operating SystemThe Cloud - On Your TermsPublic Cloud PaaSServicesPublic Cloud SaaS ServicesPublic Cloud IaaSServicesDedicated TenantHybrid CloudPrivate Cloud IaaSServicesOn Premises Private CloudIaaS ServicesACME, Inc, PrivateCloudThe combination of Office 365, Microsoft Azure, and Mi osoft s Cloud E osystem is the reason Microsoft ispoised to continue providing increasing value to their customers. Computing power and devices continue toexpand exponentially, and the number and variety of processes, services and devices enterprises will need tointeract with, manage and gain insight from will as, well. Mic osoft s Offi e, Azure and Cloud Ecosystem, isthe New Business Operating System (NBOS) and NBOS is the cloud on your own terms.13

The New Business Operating SystemThe combination of Offi e, Mi osoft Azu e, a d Mi osoft s Cloud E os ste is a compelling combinationof cloud-computing capabilities. Enterprises can leverage NBOS on-premises, in hybrid implementations, orcompletely in the cloud.New Business Operating SystemMicrosoft Office 365Desktop & Native ApplicationsBusiness Web AppsApplication LayerOAuthSecurity LayerBusi ess API sOffice 365 APIs3rd Party Clouds3rd Party APIsServices LayercSystem Center2012Microsoft AzureComputeWindows Server 2012 R2ManagementVirtualMachinesWe b Site sData ServicesSQL DatabaseBlobStorageCloudServicesMobileServicesApp ServicesActiveDire ctory Multi-factor AuthenticationAppControllerTable Storage CachingNetworkingService BusCDNStorSimple HDInsightNetwork ServicesVirtualizationMedia ServicesVirtualMachineManagerFile Services & FailoverNotifica tion HubOrchestratorTraffic ManagerExpress RouteVirtual NetworksSche dulerStorageAzure re

In our previous whitepaper about SharePoint 2010, we described SharePoint as an operating system: the olle tio of soft are that dire ts a o puter’s operatio s, o trolli g a dscheduling the execution of other programs, and managing storage, input/output, andou i atio resour es. ( defi itio , a ope ati g s steust e a le a d s hedule p og a s , manage storage, control I/O ande a le a ide a a of ou i atio paths. The o i atio of Offi ea d Mi osoft s Cloud E os steprovides standard and custom programs, storage, I/O, and enables inter-process communication. A businessoperating system must enable management and execution of a business strategy. We ll defi e usi essst ateg as:The collection of policies, processes, and procedures that directs resources, schedulingand execution to achieve business objectives (deliver value, products, services, et .).(ThreeWill)We know an enterprise s ability to develop long-term strategies is impacted by Moo e s La a d Co ti uousDelivery. However, why do so many enterprises still lack a coherent business strategy that exploits the benefitsof the NBOS and the new App model.15

Three Perceived Barriers to the NewBusiness Operating SystemMany enterprises are moving to the cloud cautiously, or not all, continuing to invest in on-premises SharePoint2013 upgrades. These lift and shift upgrades do not embrace the value proposition of the NBOS or the newApp model. There are a wide variety of reasons for this cautious approach, especially in regard to SharePoint.Unfortunately, these concerns often preclude open dialog about the benefits of the NBOS, regardless of private,public or hybrid implementations. There are three common characteristics to cautious investments inSharePoint 2013 or Office 365.1. Compliance2. Control3. CustomizationThe first two characteristics are more organizational than tech

The audience for this white paper is CIO [s, CTOs, IT P o [s and Solution Architects. The information in this . SharePoint 2013 and provide guidance and insights to how enterprises can derive business value from the NBOS. Some industry pundits pai vt ShaePoi vts future as bleak. ThreeWill believes these changes present compelling