Cloud Computing is THE thing we need in IT these days. But frankly, how does it fit in the evolution of the business? What value does it add?
Let’s focus on the role of the CIO. He or she is asked to increase agility, reduce cost and make new technologies available. But many companies use 70 percent of their IT budget for operations, keeping the environment going. They only have 30 percent available to improve processes, transform the environment and innovate. So, something drastic is needed, and that’s where virtualization, automation, standardization and, ultimately, the cloud plays a role. The goal is to create enterprises that are always connected, where information can be found in a heartbeat, that can make decisions rapidly and that are able to adapt their business processes and ways of working quickly. We at HP call that the Instant-On Enterprise.
These trends require the CIO to transform him/herself into a “strategic service broker.” What do I mean by that? Let’s take a business process, let’s say order entry, and let’s think about what it comprises. Order entry consists of a number of steps that are executed sequentially or in parallel. Each of those steps consist of an elementary function, some of which are performed by people, others by computers, and some by an interaction between the two. When the order entry process changes, most often it is because steps are re-ordered, new steps are added or removed.
Now that we have a computer literate workforce (gen-Y), could we provide them with graphical environments to develop and maintain business processes, using a repository of “steps”? And could we make the IT department responsible for providing the steps? That’s precisely what “service oriented architecture,” in short SOA, was promising.
With that in mind, the CIO is now responsible for providing the business with the appropriate steps (which I will call “services” going forward) to do their business. It first requires proper governance between the business and IT to know what the required processes are and to establish their lifecycle. Once the CIO knows which services he needs to provide, he can choose the delivery mechanism, and here he has three possibilities:
Our cloud offerings provide the infrastructure and software to run and manage such integrated environment. Through their modular nature, functionality can be built-up over time, starting with simple automation for example, and leading to shared services, billing etc. at a later stage. The core piece of this vision is the service catalogue and user portal through which the user identifies which services he/she wants to use and accesses them.
So, what is the benefit for the CIO to become a strategic service broker? There are multiple ones:
Companies definitely need to look at cloud. But know it will take time to transform the existing IT assets. It’s important companies can manage the hybrid delivery they will have for the near future.
I would like to hear your thoughts. Do you believe the CIO will become a strategic service broker in the future?