Cloud is hot right now, but is it hype? A fundamental transition? Or the next paradigm shift? What is clear is that the business understands that it is dependent upon IT, but unfortunately, rather than discuss detail, the business wants results. The current business climate requires that IT must exhibit capacity flexibility which I express in terms of elasticity or scalability. From an operational perspective this is the ability to scale up and scale down based on the business fluctuations both expected and unexpected at an appropriate cost and service level based on the businesses appetite for risk.
Further, the business requires that IT be more responsive to the business demands in the form of faster to achieve high business flexibility and take advantages of business opportunities.
The requirement for flexibility, scalability, reduced reduction on the internal IT department has typically led several organizations investing in Cloud solutions to provide specific business functionality usually rapidly due to the perception that IT cannot deliver the solution in a timely manner.
So the reality of today is that Cloud is a 1:1 relationship, typically between the Cloud provider and the business consumer. The business will be paying for the service out of an operational expenditure basis and the consumer typically feels that they are in control of the relationship and if the provider doesn't deliver, then a simple termination of relationship and moving to the next cloud vendor is all that is required. That's simple, correct?
What happens with integration with other internal systems? What happens when the Cloud provider subcontracts your account to a third party--where is your data? Is it secure?
All good questions and a recent CIO Research survey identified that the top 5 concerns for Cloud adoption included:
- Security 45%
- Integration with existing systems 26%
- Loss of control of data 26%
- Availably concerns 25%
- Performance issues 24%
- Governance Issues 19%
These concerns, although relevant to IT, are not those of the business. Instead, the business is concerned about the organization's viability and thus the great divide between IT and the business continues--with IT and ITIL professionals failing to embrace the opportunities that Cloud Computing brings to your Service Management program.
The Wikipedia defines Cloud computing as:
"Cloud computing is a style of computing in which dynamically scalable and often virtualized resources are provided as a service over the Internet. Users need not have knowledge of, expertise in, or control over the technology infrastructure in the "cloud" that supports them".
The primary misconception in the industry is that all IT will simply go to the Cloud - this is absolute nonsense, at least in the short term, as most IT organizations will deliver part of their service themselves and partially through third parties. The role of the CIO is fundamentally transitioning from one of simply managing operations to managing IT as a service value chain-- a chain that may become more complex over time. IT will weave together & optimize the Service Value Chain to best support various customers to enable business. If anything, in the short term this may increase complexity, but it's hard enough to solve a problem today internally with multiple departments involved. How will we resolve this with multiple partners involved?
We--meaning IT--have no choice! We must change the way we operate, now is the time to transition from a reactive organization to a proactive, agile and business engaged organization. The choice if we do not is that we will grow in irrelevance to the business and they will work around us and not with us.
In my opinion, the cloud provides IT with an unbelievable opportunity to rapidly transition by partnering with the business. For instance if the business engages with a third party partner they will be paying "green dollars," i.e. real money from their budget and cash from the business to the partner. They will need to identify a relevant level of service for the money paid and they will quickly realize that changes to the requirements cost money. This will, of course, be represented in a service level agreement that may take the form of a contract that is binding to both parties. Now where the agreement is between the department and the third party that is quite simple, as you will agree. That said, the world is not simple and the reality is that integration with other systems, partners etc with will complicate the environment and the reality is that services are delivered through a complex combination of partners, both internal and external. How do we deal with security, managing risk, compliance and governance?
This is where Governance and Service Management are perfect partners to deliver value to the business and assist IT in transitioning and building their relationship with the business. To add value IT must transition their focus from operational processes (such as Event, incident, problem and request) to allow focus on processes that will add value and are top of mind for the business. These will include; Service Level Management, Financial Management, Supplier Management, Capacity (using internal plus the cloud), and ensuring that the focus on the business drivers and priorities is top of mind. In short, we present IT as the enabler of technology enabled business, not the inhibitor.
The lesson here is don't fight the momentum - leverage it!