Cloud Computing – It’s Not All About IT

November 16, 2011

In a recent Harvard Business Review article by Andrew McAfee, he discusses “What Every CEO needs to Know about the Cloud” (click here for summary of article or here for entire article – free registration is required).  The article is an interesting read for any CEO contemplating how cloud computing will change their business.   While the article does a great job of explaining what the cloud is, as well as its benefits and challenges,  the true focus is on who will be defining how the cloud alters the long-term future of a business (hint, if you think it is your IT department, think again).

Every investment management company has either begun implementing or is thinking about moving some parts of their business to the cloud, mostly non-mission critical functions such as basic administration and human resources services.  All these moves are helping departments operate faster, smarter and with fewer resources.  These are largely IT efforts, with the IT department determining when and where the cloud is being utilized.  But, as the HBR article portends, while taking small steps is a good way to get started in the cloud, it is going to take more strategic and innovative thinking to turn the use of the cloud into a competitive advantage.  Who is going to do that thinking?  The IT department that is spread thin and is focused on maintenance and implementation strategies?  According to HBR, it will take innovators and forward thinkers to envision how the cloud can evolve your company beyond the apparent benefits.

Similar to the concept my colleague talks to in a previous blog (click here for post), the business decision to move pieces of your business to the cloud only to help your IT budget is a short-sighted solution. In the previous blog post we discuss the decisions around choosing to outsource some or all of your middle-to-back office and there are many parallels between deciding whether to outsource and whether (and how) to leverage the cloud.  Both are large strategic and operational decisions that require a wide variety of stakeholders to align around the change.  And both need to be thought of as more than just a cost remedy.   They need to be strategic solutions where business leaders translate that strategy into operational tactics that can be executed and supported by IT.

Decisions have to be focused on “How will doing this make my company do business better?”  We believe that executives must take the time to figure out how to change their business to take advantage of cloud computing.  It will be these “out of the box” thinkers that push the cloud vendors to “innovate and differentiate” their offerings.  The companies that leave all the strategic thinking  about the cloud to the IT departments will be left behind.  To quote Andrew McAfee, “How would you feel if your main competitors started pulling away from you …simply by changing their computing infrastructure?  And how much worse would it be if this change created other benefits that are not yet obvious?”

Somewhere in your organization people are working on the cloud (either implementing it or analyzing where it makes sense).  Do you have the right people thinking not only about how it can help efficiency and budgets now, but also about what it may do to the way your business is conducted in the future?  Even if you aren’t thinking about it, know your competitors are.

– Claudine Martin, Product Marketing

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