Cloud key to increased business profitability: IDC

IT professionals who refuse to consider Cloud services risk becoming irrelevant in coming years, research firm IDC has warned.

IDC associate vice president of research, Tim Dillon, told attendees of Cloud for Business Conference 2011 that Cloud services would be inevitably required to outsource the complexity of infrastructure and instead allow internal IT professionals to focus on coupling IT with business priorities. Reorienting IT focus, he said, was crucial for enterprise in the future.

“At a certain point we are going to become irrelevant as IT professionals if we don’t start to change our philosophy and change how we drive the business and look at what we’re doing within the business,” Dillon said.

“I’m not saying that we’re going to take all of our infrastructure away, I’m not saying that we’re going to take all of these things and throw them into the Cloud but a certain component of this is going to happen.

“If you look at the complexity out there from consumerisation of IT to smartphones and tablets and what that means for enterprise and then look at the growth of data and the requirements that sit upon our organisation, there is a whole lot of complexity building up out there.”

As this complexity builds so too does the bureaucracy, Dillon said. Building bureaucracy would likely kill an organisation’s ability to respond to crises.

“Cloud will make us shift our view of what we do as IT professionals, take some of that complexity and give it to someone else and allow us to focus on what we should be doing properly and this is the business side,” Dillon said.

Dillon noted a shift in the reporting line of CIOs from the chief executive officer (CEO) five years ago, to the chief financial officer (CFO) as the business’ finance arm gained more influence over IT in the business.

“I think this is a good thing because if we don’t gain a broader understanding of the business we are going to be confined to more an influencer or recommender role, not necessarily a role in driving the business as hard as we could,” he said.

According to Dillon, the role and the focus of the CIO has expanded to incorporate other areas, providing the ability to appropriately influence the organisation as a whole.

“This means a change in priorities; about 60 per cent of CIOs are focused on business profitability and driving the business, another 27 per cent are looking at modernisation, migration and efficiency while just14 per cent of the 460 companies we spoke to in 2010 are focused on the ‘lights on approach’ of IT maintenance type things.”

“Five years ago it would have been much more heavily around the IT maintenance, so it’s this driving of the business, it’s the interlocking between the business and the technology goals that’s on the rise.”

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