CIO Leadership, Cloud

What's holding CIOs back on the cloud? Movers and those who get moved.

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Re-reading a book I received a couple years ago, I found this expression “walk the escalator”. The book is titled “Jump the Curve, 50 essential strategies to help your company stay ahead of emerging technologies” and written by futurologist Jack Uldrich. He points out that, despite the fact the escalator was created to help us reach the next floor faster, most people stand on the escalator, actually taking longer to get there. It’s a great analogy for cloud and the adoption of cloud by the CIO and the IT department.

The cloud is a fact, according to Mark Thiele it’s not a tactical solution but rather a corporate strategy. So, why are so many CIO’s slow in adopting it? What is holding them back?

Is it job protection? Is it change avoidance? Frankly I don’t know. But I see an increasing amount of business people of the opinion that, with the cloud (and they mean public cloud) out there, the IT department is no longer needed. I personally disagree with this fact, but have to recognize that, when the business got the impression IT became too expensive and inflexible; many explored outsourcing IT all together. Although this happened with varying success,  we might be at a similar inflexion point.

Uldrich quotes Benjamin Franklin “All mankind is divided into three classes, those who are immovable, those who are moveable and those who move”. The fundamental question is in which category you think you are and how the business perceives you.

Whether we like it or not, the role of IT is changing. The enterprise expects more agility and responsiveness from its IT department and many users, frustrated with the current situation, use external services to address their needs. That’s what we call shadow-IT. In the process they host company data on external servers, making assessment of compliance and enterprise risk difficult.

Change is quickly becoming the only constant in our fast moving world. The CIO has to make the decision to lead this change (move) or he/she will be pushed aside (moveable) in the near future. In that process a couple elements need to be put in place:

  • Governance between business and IT to clearly understand and prioritize the needs
  • Sourcing strategy to define where services will be sourced from

We need to reverse the thinking, looking first at sourcing the service from external providers prior to developing and delivering the service internally. In doing so, the IT department will be able to focus on the key services that clearly differentiate the enterprise from its competitors. It will also give IT the possibility to act as the technology consultants to the business, helping them exploit the full potential of information technology in their business, helping to grow the company through performance improvements and innovation.

So, do not just walk the escalator to keep in shape, but do it to pro-actively transform your IT department in a competitive advantage for the company as a whole.

The complete version of this blogpost was posted in CloudSource.

If you are interested in understanding how you can move existing applications t a cloud and you happen to come to HP Discover, why don’t you plan to join my session (TB2051) on Thursday June 7th at 11:15AM in room Titian 2205? I’ll focus on the architectural aspects of transforming apps to the cloud and how they can integrate across a converged cloud. I would really like to meet you there.

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Discussion
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Tech Marketer
Ali L 0 Points | Mon, 06/11/2012 - 23:09

True. In my opinion cloud has now become a competitive edge for organizations, and those you are still holding back will be left behind.

Gartner published its list of top 11 predictions in 2012 – a much anticipated list that we read religiously. One of their predictions is that 35% of IT Budgets will be managed outside the IT department by 2015. CIOs will see their budget reallocated to a different business unit where the business manager is in control.  Business managers are demanding more control over the IT expenditures related to their jobs. This creates a threat to CIOs and as their budget is shrinking, perhaps their role as a strategic executive is diminishing as well. Not necessarily.

Budgets may be shifting within IT organizations, but a way that CIOs can retain control is to move budget to outside cloud service providers who can answer the needs of business managers. The rise of low-cost cloud service providers, like dinCloud, enables the CIO to: lower overall cost for the organization, mitigate some of the pain of IT management internally by partnering with a trusted cloud service provider, and enhance their role as a strategic advisor to the CEO with a seat in the boardroom.

AlecWood
Alec Wood 0 Points | Tue, 05/29/2012 - 15:53

I think trust is the single issue ignored by public cloud advocates and preoccupying foot-draggers like me, especially in regards to who has access to our data and how, and under what circumstances this may be changed, how we would be informed of a breach (intentional or otherwise) and what recourse we would have in the event of one.

Vendors just gloss over it, advocates dismiss it as paranoia, but the concerns are real (especially for non-US companies), as are the consequences of them being realised.

So we'll probably continue as we have done, a mixture of private cloud and traditional solutions until such time as the concerns are addressed, or the vendors are over-come by the truth-fairy's spell

 

Goddardd
Doug Goddard 122 Points | Tue, 05/29/2012 - 14:50

I believe we are talking about the public cloud in this context so my "guess" as to the causes of the tepid response to the public cloud are:


1. Service value is a function of utility, warranty and ROI. There are millions of applications that run on the cloud, but how many of them can run a business, taking into account the competitive positioning of the business? Are the services guaranteed to the level expected. For example, does the cloud provider write me a check if their service goes down for any length of time? If I am running my business on standard cloud applications, how does that make me any different than my competition? Finally, how does cloud compare, from a cost perspective, to the alternatives that directly compete with it.


2. Organizations are probably still trying to put the Cloud into a services perspective. Is it another type 3 service provider? Does it replace outsourcing? Can I include it as part of a higher value service package? Is it mainly a commodity, shared service, and so on? In other words, where does the public cloud fit?

 

 

Christian
Christian Verstraete 402 Points | Tue, 05/29/2012 - 15:24

Doug, actually I'm not limiting myself to public cloud. I refer here to any type of cloud, where there is virtualization, automation and self-provisioning. I still see CIO's not believing this adds value to the business. At the same time, their line of business people use external clouds (public clouds) extensively behind the back of IT. So, I was more depicting this post as a wake up call for people to understand they should better take a strong look at things.

pcalento
Paul Calento 256 Points | Sat, 05/26/2012 - 14:33

At cloud conferences, there seems to be a noted difference between the (pro-cloud) rank-and-file and the (more conservative) CIOs ... many of which are attempting to rationalize what's already been done outside of an actual strategy.

Specific to governance and sourcing strategy, it would be interesting to find out what's a bigger cloud inhibitor. To that end, I've started a related conversation on LinkedIn CIO Forum.

--Paul Calento

(note: I work on projects sponsored by EnterpriseCIOForum.com and HP)

mdavis10
Martin Davis 128 Points | Sat, 05/26/2012 - 01:00

Hi Christian, totally agree, either embrace it or get run down by it! You seem to have reached similar conclusions to my recent article.

jdodge
John Dodge 1359 Points | Tue, 05/29/2012 - 12:29

I Googled "CIOs who have embraced the cloud." I did not get one hit back with a list or a strong CIO Cloud advocate in the first two pages. I did find a phrase that caught my eye: "CIO: Agile rebel or company dishwasher?" 

http://searchcio.techtarget.com/news/2240146716/Mobility-strategy-CIOs-h...

Christian
Christian Verstraete 402 Points | Fri, 05/25/2012 - 16:46

Pearl, I'll come to that and will address the orchestration piece. So stay tuned.

pearl
Pearl Zhu 89 Points | Fri, 05/25/2012 - 16:43

Very interesting blog to craft cloud strategy following with action, espcially Benjamin Franklin's quote “All mankind is divided into three classes, those who are immovable, those who are moveable and those who move”, perfectly make sense to push cloud envelop, the tough part is still about orchestration, how to manage three classes to drive effectivenss and efficiency.