Why one of the world’s biggest wine companies decanted itself off of cloud

Profile picture for user gflood By Gary Flood May 5, 2021 Audio mode
Chile’s Concha y Toro says over-promise and under-delivery forced a partial retreat from cloud for a key business application

Image of Concha y Toro Wine
(Image sourced via Concha y Toro Website)

Known for brands like Casillero del Diablo, the most popular Cabernet Sauvignon bought for British tables, and Don Melchor round the world, Chile's Concha y Toro is largest wine-growing company in Latin America and one of the leading producers worldwide.

Technology has always played a major part in the company's efforts to deliver, with current initiatives including automating its irrigation system to control the humidity and temperature of grapes in the field, placing of multiple IoT sensors in its wine vats to monitor the fermentation process, and more experimental projects such as drone-captured video analysis of overall grape stock health.

The nearly 140-year old company, which this year became a B Corp, sees itself as a family business that has managed to thrive and expand despite many challenges. And intriguingly, one such challenge was a decision to put some of its infrastructure in the cloud-a decision it says it very much benefited from reversing, as its CIO Daniel Duran told diginomica:

Sometimes the promises your vendors give you about their solutions don't pan out. That was the case for us, because we didn't have the resources that we needed because of some bad decisions by our on-demand partner.

We were very frustrated by that, and we had to talk to the vendor to try to make a work around to get out of the hole that we were now in. For four or five months, that was a very dark period for us.

We'd been oversold

The backstory here is that the winemaker was looking for new technologies to improve operations and found cloud as a new possibility to run its solutions. Some 21 servers were then migrated to what Duran wants to discreetly call "an international provider"... and, he says, at the beginning, the solutions worked as the brochure said it would. Duran explains:

We had an application on demand and the database was on-premise, and for the first two years the service was good-all as promised. But in the middle of 2015, the service downgraded sharply; time response grew to a level where we couldn't work properly, our SAP transactions went from running in seconds to more like 2-3 minutes.

Essentially, the cloud storage provider we'd chosen had oversold the service and put too many customers in the same cloud. Result: the system was not able to deliver a proper service to all of us, the time response was very slow and the operational costs were higher than the original business case. We tried to optimise, but didn't achieve what had been forecast.

Ensuring applications and projects are always accessible

Duran stresses that he and his team still believe in the cloud - and indeed Concha y Toro has continued some use of the approach all the way through this experience, and indeed is moving some services and solutions there imminently.

Nonetheless, he is more than relieved about going back on-premise for the resource he says ran dry. He says:

Once everything was stabilised, we were finally able to get our heads up and just breathe. We said wait, there has to be another way we can do this: we can't do it again the same way. We needed to ensure our applications and projects are always accessible, can scale to meet demand, and are fully protected against cyber attacks or data loss.

Duran says the answer that made most sense was to choose Pure Storage, a pure-play storage supplier that claims to be one of the top five storage vendors worldwide by market share and which committed very early to Flash as its core technology.

Yet Concha y Toro while has got its system response for this core application back down to under 1 milliseconds as needed, in a way it kind of hasn't given up all the advantages of cloud-style IT service procurement, as Duran has been careful to sign up to a service from his new vendor, Evergreen, that provided a customer maintains its subscription, the vendor is responsible for upgrading hardware and software-just like if they still had a cloud contract.

And this security is the right basis, he states, for the next stage of use of information technology at the organisation. Duran adds:

As CIO, my role is to improve all our processes and to use technology to drive better understanding of our  customers and so deliver better products. Plus, the major goal of the company is to make us a truly real-time company, where information flows from the origin to solution, so as to support the right employee experiences in all our different areas so they can make better decisions in real-time. That means we can make better decisions not just in customer-facing roles but also in our administrative and production facilities.

But now, we will be very careful in what solution we move with-and which vendor we move forward with.