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Businessownership.ulitzer.com: Blog Post

The Consequences of Cloud Adoption

Are we thinking enough ...!?

Alright, Joe Blog, I am the new CIO and I want to cut costs and ride the organization to the next-generation wave of cloud-based services....! Impressive.... It allows the organization to ride on the new wave...we will have a more sophisticated platform, we will have a new solution that is cost effective...more control (?!) and so on....

Needless to say, cloud-based solutions have their advantages and are impressive enough for organizations to test and embrace. I wonder how much time organizations spend thinking about the consequences of cloud adoption and how they can be ready to support their business needs.

Some years ago, strategic planning becomes essential to every organization and a corner or a floor of the office would be filled with the strategic thinkers defining the roadmap and plan for the organization for the foreseeable future (most of the time it was five years - don't know why). Nowadays we don't see that at all. While there is some debate that five years is too long, there is no alternative. While schools debate the ability to apply strategic themes and relating to the execution, I believe that the company needs to find its niche in defining its future path with little or no help from the consulting firms. It is essential that they know where the business is going instead of hearing fictional or anecdotal evidence.

Okay, back to the source of the problem. How come strategy and cloud is related. Cloud at the end of the day is a pattern or a form of delivering IT solutions to meet the business strategy. And business strategy is of critical importance for the organizational roadmap. Therefore they are intrinsically intertwined.

The beauty is that they can work together. The cloud gives us the opportunity to bridge the silos between business and IT. What is important is making sure that everyone inside the organization understands the implications of this.

There are three things I would consider before adopting a cloud solution.

1. Business Value
What is the problem I am trying to solve? How does it directly relate to the organization's core competency or niche? Is it a simple case of IT standardization / cost saving or is it something more than that? Does your organization have the ability and appetite to measure and monitor the quality of the execution. Note that this has nothing to do with cloud. It is internal organizational efficiency. While I acknowledge that some people may argue there is no need for that, I think that we need to measure and monitor the outcomes of the approach. Defining the business value becomes very challenging nowadays. Do you assume that jumping on the bandwagon of next Facebook is the way forward, but how do you quantify how that converts into revenue? Equally, doing the same thing over and over again does reduce the revenue and therefore profits. What can you do? I am sure of one thing - cloud is not the answer for this. So do not attempt to solve the symptom (cost reduction) without worrying about the root cause.

2. Business Change
We are so complacent that we do the same thing over and over again and expect different results - except a different place and time....something I really enjoyed hearing from the movie "Wall Street." Needless to say, changing the IT systems to the next generation of technologies does bring zero value if your organization or business teams do not embrace the change. How would you take them on the course or on the journey? This is not something that cloud can solve. While cloud becomes an opportunity, in fact the level of investment required to do the business change is much more than the adoption of the cloud. First and foremost what I would ask for is not a "transitional/transformational CIO" but a leader who stays on to see the change through and embrace it. Second, putting yourself into the problem space and understanding the problems of Barbara in Customer Service, Sam in the Call Center, David in IT systems that is distilled from their moaning to the actual challenges that they face. They are in fact small but often ignored, leading to a lack of appetite in embracing any new technologies, therefore leading to staff reduction or attrition.

3. Supplier Maturity
The danger is going with anyone and everyone just because all of them want to join the bandwagon. I wonder if this could also become equivalent of a .Cloud bust - what we saw during the .com years. You don't need a financial analyst to predict the market - two or three of the cloud vendors going under is reasonable evidence of a cascading impact across the board. This is where the supplier maturity comes into effect. Is your system integrator (or IT supplier) thinking beyond the utilization of resources, is your supplier thinking beyond the status quo and the consequences of the future, what level of thought leadership do they bring onto the table to support your challenges, which are unpredictable. This is where it changes the current engagement model from outsourcing to partnership because they don't play the role of offering services but they act as a bridge between your strategic vision and the realization of them in the form of IT systems.

Summary
I want to take the opportunity to present my views of the danger of cloud while the intent is not to emphasize that there are problems in the traditional way such as security. I want to highlight the sweet spot where organization may go wrong. This is just my view and my personal view only and do not bring any organizations that I have worked or working into the picture.

Happy to hear your feedback.

More Stories By Nandakumar Balasubramaniyan

Nanda is working as Principal Architect with Infosys Technologies Ltd. He brings in more than 15 years of online experience. Prior to joining Infosys, Nanda worked in Public Sector and Consulting organisations. He has been awarded as the “Consultant of the Year” in 2008 by British Computer Society for delivering business value to customers through his exceptional planning, leadership and organisational skills. He has demonstrated capabilities in developing large scale transformation from procurement to Transitional state. He holds an MBA from University of Wales.