How cloud services are an organizational innovation, not a technology "silver bullet"

By Dr Steve Hodgkinson, Research Director, IT, Asia-Pacific, Ovum

Many executives regard technology evangelists as “drive-by shooters” – people who cruise by their offices firing so-called “silver bullet” solutions. Are cloud evangelists in this category? Perhaps. If they are selling cloud computing as a technology innovation, then the “drive-by shooter” label can fit quite well.

Most ICT executives know how to manage technology evangelists: they do not let them into the office. Cloud services evangelists, however, are a much bigger problem because they proffer pervasive organizational disruptors – pre-assembled bundles of people, processes and technology – not technology point solutions.

The challenge for the ICT department is fending off the army of cloud services evangelists that is out there selling piecemeal organizational disruption to executives throughout the enterprise. The ICT department must get ready. It is in danger of losing its monopoly over the provision of ICT services, and a big test of enterprise ICT leadership is looming.

Technology evangelist “drive-by shooters” create panic and confusion

The ICT industry is relentless in the pace of its innovation. Enterprises have barely managed to implement one generation of technology or methodology before they are challenged by something better, faster, and cheaper, or, at least, new. It is easy for executives to feel constantly on the back foot, trying to implement yesterday’s innovations while defending against the distractions of today’s and keeping an eye on the possibilities of tomorrow.

Vendors and their technology evangelists selling point solutions can come to be regarded by executives as “drive-by shooters” – cruising by and creating panic and confusion with a barrage of innovations. Although cloud technologies are seen by many ICT folks as the latest “silver bullet” point solutions, the problem arises when cloud technology evangelists over-hype the benefits of point solutions and under-state the costs, risks and difficulties of implementation. We have seen before how hasty adoption of new technology strategies can result in more harm than good.

Most ICT executives have, however, worked out ways to manage these “drive-by shooters.” They ruthlessly control the enterprise ICT strategy and procurement activity. The mantra of “consolidate, rationalize, and standardize” is a defensive shield. It is not worth accepting a sales meeting that may turn into yet another messy “drive-by shooting.”

Cloud services evangelists are aiming at a bigger target with a more powerful weapon

Cloud services, however, expand the shooters’ target beyond the relatively well-defended offices of ICT departments. Cloud services are also a more powerful weapon: they offer much more transformative potential than the cloud technologies from which they are assembled. New strategies will be required to confront the incursion of cloud services into the enterprise.

A mature, enterprise-grade cloud service offers an organizational solution – a pre-assembled bundle of people, processes, and technology – rather than a new technology building block. Cloud services are not just a “silver bullet” technology solution for the ICT department to consider or reject as a new element of its technology strategy. They are a fundamental challenge to the legitimacy of the ICT strategy and the ICT department’s role as a provider of infrastructure and application services.

They pose an even greater challenge to the legitimacy of internal sub-scale, under-invested, and under-skilled ICT shared services arrangements. In contrast to many internal shared services, the market-leading cloud services are shared services that actually work, and empower their customers – giving them freedom and choices while still delivering economies of scale and scope.

So, in fact, it is a mistake for ICT executives to assume that cloud services evangelists are simply the next wave of technology “drive-by shooters” to be stonewalled by personal assistants.

ICT departments must recognize cloud services as an organizational innovation

The challenge posed by cloud services is that piecemeal, uncoordinated adoption will unravel the very logic of enterprise ICT strategy and, ultimately, the organization of the ICT department and internal ICT shared services arrangements. Cloud services can be sourced relatively quickly, easily, and inexpensively. Business executives can, and do, buy them independently of their ICT department’s “grand plan.” A widening gulf between the innovation cycle-time of the ICT department and of cloud services providers, combined with rising budget constraints in enterprises, will exacerbate this behavior.

While Ovum advocates that enterprises should gain hands-on experience of cloud services in order to truly understand their benefits and risks, this is no excuse for allowing “drive-by shooters” to create another devolved mess of fragmented solutions, unmanageable information flows, vendor relationships, and counterparty risks.

The adoption of cloud services can cultivate the kind of decentralized decision-making environment that is an ideal target for “drive-by shooters.” The best defense is flexible enterprise ICT strategic thinking that includes an awareness of the big-picture trends in the ICT industry and the preparedness to get a new grip on the logic of ICT management. A key strategic perspective is recognizing that cloud services are primarily an organizational innovation and will therefore require a strategic, outward-looking, organizational response rather than a rigid, inward-looking defense of the enterprise ICT perimeter.

A big test of enterprise ICT leadership is looming

Cloud services, therefore, present both a threat and an opportunity for enterprise ICT strategy. As cloud services mature and are more widely adopted, ICT executives will quickly need to work out how to include them in the enterprise ICT portfolio. Hands-on experience of cloud services within the ICT department itself will be a prerequisite for pragmatic thinking about the new benefit/risk tradeoffs involved.

Cloud services evangelists are knocking on doors throughout the enterprise. The ICT department is losing its monopoly over the provision of ICT services, and a big test of enterprise ICT leadership is looming.

The Ovum Cloud Services Framework can help

One way to start getting ready is to use Ovum’s Cloud Services Catalysts Framework to understand the organizational catalysts for cloud services adoption (see the Ovum report Practical Steps to the Cloud for Government Agencies). This framework can provide a useful tool to engage executives in a dialog to pinpoint opportunities where cloud services can be a good fit for enterprise needs – and where they may not be. Ovum analysts can also provide thought leadership, research, and case studies to assist executives to understand the trends and implications of the rise of cloud services.

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