Published by Dan Mason and Paul Scott
Why should I care about Cloud Technology?
Cloud Technology is a disruptive force changing the computer landscape dramatically, and forever. All senior business leaders, not just CIOs, should understand the opportunities and risks posed by the game-changing Cloud Technology (CT) movement. From a business perspective, the promises of Cloud Technology are capital and operating cost reductions, greater cost efficiency (bang for your buck), greater agility, and better IT service satisfaction. As CT rapidly blows past the "hype" stage into serious implementation in companies from SMB to Enterprise, leaders need to develop well-defined positions, strategies, and action plans. Even if the right strategy is to take no immediate action, you need to assess your company's potential usage of Cloud Tech both now and down the road. Almost all companies can benefit from Cloud Tech in some way; commitments to using Cloud technologies range from simple, low-risk, low-cost solutions to holistic "bet-your-company" propositions.
What Do I Need to Know?
In short, you need to know enough about Cloud Technology to develop your own perspective on whether it could improve your organization's IT operating model now or in the future. First and foremost, you should understand that "The Cloud" is not a single technology, nor a technological breakthrough. It is a convergence of many technologies and trends. Together new business models and architectures are enabling more efficient use of technical resources and services. A Cloud approach can replace your entire IT infrastructure, or merely enhance it around the edges. "Cloud Technology" is an umbrella term that defies strict definition, although IT vendors are happy to take advantage of the confusion to stamp their products with the Cloud label in hopes of locking you in to a specific implementation. As the industry hype subsides, the attributes of what really qualifies as "Cloud" are becoming clearer, as are the real benefits to be gained and the real risks and obstacles to be overcome.
I don’t want to succumb to hype; is it real and can I save lots of money?
In regard to potential cost savings and competitive advantages, every company is different. Unfortunately, there is no magic formula to assure us of the correct answer. Ascension has found that leaders have been asking three questions regarding the move to cloud technologies: 1) If I move early, will I have an advantage over my competition? 2) Is the moderate approach better—keeping at par with my competition? 3) Should I wait until cloud computing is fully mature, understanding that I will mostly likely lose competitive and/or cost advantage? Ascension suggests that you assess these positions together with other members of the leadership team—finance, sales and operations. Determine the potential for increasing competitive advantage, and whether there is a real opportunity for cost savings. There are many ways to benefit from the rapid advances in Cloud Technology, if you have effective leadership to navigate the Cloud and separate the hype from reality.
How do I evaluate my competitive risk or reward position?
When evaluating Cloud strategies, it is imperative to assess cloud technologies directly against your own long-term business strategy and current operating models. Ascension strongly advises that companies use only the business requirements, and strategic plans that they have defined, rather than accepting a vendor's canned solutions. Case studies from vendors do not consider specific factors such as your need for resource elasticity, capital situation, risk profile, and employees' specific demands for modern computing services.
We believe your assessment needs to be fundamentally a financial review. Break down the current costs of managing your infra-structure and applications--associating how capital and operating expense are represented. Use your technology group, possibly with the help of other professionals, to learn and understand how cloud offerings can assist and support your business’s strategic direction. Compare and contrast your findings. We have seen in many instances, that a group of applications can be moved or re-programmed into a cloud application with significant savings and improved performance.
Once you have a defensible position, you can move forward. With this rapidly-evolving field you may need some help. Dan, Paul and the Ascension team are here to assist you. Please feel free to contact us with any questions or concerns.
