Why CIO’s need to embrace the cloud

Generally speaking CIO’s in mature businesses aren’t that happy about the cloud computing trend.  (there are some notable exceptions ) For most cloud viewed as a major annoyance as your typical  CIO’s doesn’t like other business manages going around them and literally sign up to new services without touching the IT department let along consulting with it or abiding by policy decisions. Others rightly view cloud computing as a form of outsourcing, and outsourcing in what ever form it takes normally means substituting something you used to do with someone else doing it.

These are all valid concerns. If i was on the hook for compliance, threat management, support costs or system availability i’d certainly want some form of control over what IT was being introduced into the business.  And lets face it, no one likes redundancies.

But for all this CIO’s must come to grips with Cloud computing.

  1. They’re user population are already using it in Skype or Gmail, saying no simply won’t wash
  2. Business managers will continue to push the CIO for more productivity applications. In all the discussions I’ve had with business managers who have gone around IT to buy a cloud app …they all did it because IT kept saying no, were de-prioritising their projects or we too costly or late for their needs.
  3. But the most important reason you need to embrace the cloud, is that if you don’t. you and you alone are putting your company as a significant competitive DISadvantage….

That’s right, DISADVANTAGE.  Here is how this works.

Firstly most of the IT you run actually doesn’t deliver any competitive advantage….

Think about it, if you and your competitor both have an email system, the benefit has been cancelled out.  Same for networks, desktop apps, servers etc etc. When you think about it there are actually very few IT assets that DO deliver competitive advantage. These are typically very specific applications to your industry, literally the one system that runs the major revenue lines (what ever that is)…. and bear in mind, if your competitor has it then the advantage is negligible.

So how do IT departments deliver competitive advantage… traditionally through an operating cost advantage, specialisation and organisational agility.

Cloud may or may not help you with the specialisation dimension, but it most certainly canhelp with organisational agility. (I’ll get onto cost advantage a minute) There are many ways Cloud can help with agility.

  1. You can build applications faster
  2. You can get test and dev done faster on IaaS
  3. You can collaboration and harness geographical expertise and speed up decision making
  4. Integration is faster (in some cases applications are pre-integrated)

So clearly cloud can deliver a speed advantage

In terms of cost advantage, I am not in the camp that believes cloud computing will save you money. It is cheaper in many cases, but companies will do with cloud what they’ve always done when they free up some money…. move onto the next project and start that. So in that regard, cloud makes IT more productive, meeting more of the needs of the business because you can now do more.

Now, having read this list of advantages companies get from cloud computing, imagine if your major competitor had all those benefits and you weren’t…..

By fighting the introduction of cloud computing into your company, that’s just what is happening.

2 thoughts on “Why CIO’s need to embrace the cloud

  1. Pingback: Cloud – why are those with the most to gain, the most afraid? | Welcome to the Gen-i Blog

  2. Pingback: Who trapped VMWare in the innovators dilemma …and how do they get out | unreasonablemen

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