By Soma Somasundaram, Executive Vice President, Research and Development, Infor
IT today is engaged in something that resembles circus trapeze artistry. Much like a troupe of acrobats attempting seamless handoffs as they fly through the air, IT organizations are trying to quickly and smoothly transition some or all of their key functions from traditional on-premise computing to the cloud, even as the business goes on uninterrupted. Just as with daring circus performers, there is always the danger of dramatic failure.
The risks, however, have less to do with actually being in the cloud and more to do with the process of getting there. The transition requires careful attention to the people involved and the continual cultivation of new kinds of IT skills and expertise. Fortunately, the rewards of a successful transition are substantial — in both the short- and the long term.
A New IT Organization
It doesn’t require any special gift of discernment to see that the traditional IT organization, which ran everything within the walls of the enterprise, is more or less dead. The days of just managing data centers and a relatively fixed suite of applications are gone. IT is now being asked to do far more — and to participate in strategic thinking and action — while shedding costs and improving agility. The cloud, the enabler of this expanded and varied role for IT, is now a mature and vital option across the spectrum of IT activities. It is IT on a scale we’ve never seen before. Consider organizations such as Amazon Web Services and Microsoft Azure, which have invested billions of dollars in building their infrastructures. They are able to provide services that you could never match within your four walls. Not everything will end up in the cloud – but almost anything could. In fact, anyone creating a business from the ground up today would be unlikely to invest in on-premise IT and unwise to do so.
If the on-premise model is fading, what does that mean for the people who have traditionally run IT? It means change, starting at the top.
As an IT leader, a CIO needs to think about how to function in a rapidly evolving role while preparing his or her organization to support the transition to the cloud. Both tasks require the CIO to acquire new and different skills.
In contrast to the somewhat ambiguous role CIOs have played in the past, essentially functioning as intermediaries between the information technology staff and the business, the new CIO role is all business. CIOs must function as partners and advisers rather than just service providers. Instead of being arbiters of capacity and setters of limits, CIOs must become business architects, implementing partnerships and providing access to services that can enable the organization to function better and move faster.
The transition to the cloud also requires the transformation of the entire IT organization. In adopting a more specialized and compartmentalized operational approach, the move resembles the evolution of the delivery of medical services.
In the past, almost all of a family’s health needs were addressed by a general practitioner. Whether it was delivering a baby, providing pediatric services, or serving the medical needs of an elder, the general practitioner was expected to somehow do it all. Nowadays, in the name of both efficiency and quality, medicine has grown highly specialized. There are practitioners for every phase of life, every part of the body, and almost every type of illness. Additionally, there are a wide range of subspecialists, for everything from physical therapy to surgery. The general practitioner is still part of the system, but he or she often functions more as a consultant, helping to understand an individual’s health needs and guide him or her to a “solution.”
Driven by the transition to the cloud, a similar transformation is remaking IT. The old model of IT as the one-stop shop for the business, or of the CIO as the main provider of IT expertise, has been replaced by a world of outside specialists. A huge ecosystem of vendors and consultants, our company among them, can now deliver applications and computing services to the enterprise.
Some of the organizations providing specialized IT services focus on infrastructure-as-a-service: IaaS. Others provide domain expertise through applications-as-a-service: AaaS. If you are an IT organization consuming these kind of services, you still need skilled IT people. But the skills are different now.
You may no longer need IT staff that can manage a server or build a CRM system, because someone outside your organization is now doing that and doing it very well. What you do need is increased specialization relative to the needs of the business and the skills necessary to coordinate and manage external providers and the internal consumers of their services. That means you will need people who can manage each of these services and bring them together in a cohesive way. You now need much more business domain expertise than technology domain expertise. You also need management and coordination skills that are commensurate with the new level of complexity and larger scope of the work of IT.
While business and broad design skills must increasingly take center stage, technology expertise will still be vital, but perhaps in different forms. Among the challenges is the need to bridge functions across multiple clouds or across cloud and on-premise. Many IT tasks will involve configuration, “massaging” data going from one system to another, and providing orchestration. Data skills will be more important, and larger organizations will engage data scientists to determine how to use data to make the workforce more informed and productive. Having the ability to leverage APIs for different applications and to craft mobile applications for your workforce will also be crucial.
The New IT
The tectonic shift in IT will not be without pain. IT will undoubtedly lose some of its traditional attributes and powers. The size and composition of its workforce may change. And, of course, it will gradually command less space and capital equipment. Instead, it will become more decentralized, a resource and a presence that touches business more intimately than ever before. Instead of being known for saying “no,” IT will more often than not be on the cutting edge of business innovation, partnering with change agents across the enterprise.
For example, the decision makers who sign on with Salesforce are typically the people in charge of sales or marketing, not IT managers. To date, IT’s role has been to support that decision and help make it successful. The new IT will share in those kinds of decisions, providing guidance on specific business challenges while maintaining a strategic view that combines an understanding of the needs of the enterprise and of trends and opportunities in technology. This central IT organization will bring together all relevant facets — applications and infrastructure — and establish policies to enhance and strengthen the whole business. IT will still have a very important role in ensuring that users have access to the servers and data they need, and there will be a particularly critical role for IT to fill relative to security, ensuring that best practices are in place to protect the business and its data.
Those kinds of management and control activities need to stay within the IT organization, though they may relate primarily to resources in the cloud.
Transitions
Some organizations have been quick to transition their IT operations to a cloud-centric world, while others have taken more time to evaluate their options. The early movers have several advantages, including new skills, lower cost, and greater flexibility, while those adopting later have an opportunity to better grasp the full potential of the cloud and to rethink their approach to IT.
Many health care organizations are now making this move. Many of them have not changed much in the past 20 or so years, and their IT infrastructures are older than in other industries. But the health care delivery model is changing from procedure-based to outcome-based, and that puts a lot of financial pressure on the health care system, which is compelling organizations to move faster than other industries. Health IT organizations can learn from the experiences of the first movers, avoid some of the pitfalls, and take advantage of a pool of IT professionals with the right experience and skills.
A few sectors, such as discrete and specialty food and beverage manufacturing, tend to have very specialized needs, such as complex industry-focused manufacturing apps. This is why the move to the cloud for companies in this sector is going slower than in most other industries. They will be the last movers and will enjoy the tremendous amount of knowledge about transitioning to the cloud that has accumulated over the past few years.
Whether you are a first-, late-, or last mover in your industry, an outside provider can serve as a safety net as you and your team vault from your existing, on-premise world to the opportunities and rewards of the cloud. It is a transition worth making and, for most organizations, is probably inevitable.
Originally published in CTO Straight Talk #2
The risks of cloud computing are not in actually having key functions in the cloud but in making the transition. The move to the cloud requires changes to the CIO’s role and to the entire IT organization.
In the cloud-based world, CIOs must be partners and advisers to the business instead of service providers. Instead of acting as a one-stop shop for the business, the IT organization must coordinate an ecosystem of specialized vendors and consultants and the internal consumers of their services.
Some organizations have been quick to move to the cloud; others have taken their time. The early movers have gained new skills, lowered their costs, and increased their flexibility, while the late movers have learned from the accumulated experience of those who preceded them.
