The cloud’s undone business revolution: the embarrassing report

Last year at ITaaSNow, we conducted a survey involving business unit (BU) leaders of 2,681 companies of all sizes in industries as varied as financial services, information technology and healthcare.

As part of our business model transformation to cloud service brokerage, we wanted to get their feedback about the business benefits that resulted from their IT infrastructure migration to cloud computing and DevOps.

The findings were amazing, they told a story the vast majority of IT professionals aren’t prepared to hear: IT departments and their CIO miss out on their BU expectations. They terribly contrast with what certain technology research global companies pretend. That’s another story.

The findings didn’t surprise us, they substantiated our point that today’s cloud and DevOps strategies are disconnected from BUs’ expectations. We’re not alone, Cloud thought leader Joe McKendrick for example, cited among the top 100 influencers for 2017, shares our views; in several articles he’s been alerting the IT community.

What do these findings tell exactly? if you’re an open-minded leader who understands that a new IT service delivery paradigm more focused on business concerns is needed, this is for you.

IT doesn’t understand the business challenges of the ongoing digital disruptions

In general, business unit leaders have the feeling that their IT department and their CIO don’t understand the business challenges associated with the ongoing digital disruptions.

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Confined in its certainties, IT doesn’t pay attention to BU concerns and vision. It deprives itself of the opportunity to play a pivotal role, more adapted to today’s competitive context.

Paying attention to BU concerns will get IT out of the obsolete infrastructure and tools provider role it confined itself. This role is increasingly assumed by cloud service providers including Amazon, Google, IBM, Microsoft, and Rackspace to mention a few.

IT cost savings and speed matter, but they’re not the only priorities

BU leaders consider today’s IT strategies obsolete as they’re based on outdated value propositions. IT cost reduction and speedy IT operations aren’t anymore the only competitive differentiators.  

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Most CIOs justify their cloud migration and DevOps transformation initiatives by the urgency to cut IT costs and speed up IT operations, particularly applications delivery. The problem is, in today’s business context where the competitive game is reshuffling with proliferating tech startups and innovative services, BU’s priority will be more on how to survive their industry disruptions.

Most participants observed, “You don’t prevent market share and customer losses or become innovation champion only by cutting IT cost and speedy IT operations. More is needed.” 

Innovation, agility, responsiveness, and revenue are the top priorities

Innovation culture, operational agility, market responsiveness, and revenue generation are the top priorities.

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IT has been wrongly considering that innovation culture, operational agility, market responsiveness, and revenue generation miraculously result from IT migration to cloud or continuous delivery tools. The reality isn’t that simplistic, making the business agile, responsive, and profitable demands a proactive transformation of at least the IT organization’s structure, processes, practices, and tools. 

That lack of organizational transformation is what we call at ITaaSNow, the undone IT’s business revolution.

Cloud computing and DevOps as implemented do not bring any tangible business benefits

Most BU leaders are fascinated by the promises of the recent IT innovations particularly cloud computing, DevOps, Internet of Things (IoT) and Big Data. Yet, so far, they are disillusioned; they don’t see the promised business benefits.

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The fact of the matter is, solution vendors and consulting firms focus their transformation effort on infrastructure and tools migration, and totally ignore the required organizational and operational transformations.  

Organizational and operational transformations are the foundations of BU’s expected benefits; by breaking down organizational silos and establishing cross-functional collaboration they accelerate interactions across the business and make it agile and market responsive while facilitating innovation culture adoption.

Secure and reliable managed IT as a service (ITaaS) could help to achieve business goals

The managed ITaaS platform is the preferred cloud-based IT capability as it not only erases IT costs and speeds up IT operations but also moves the hassles of managing IT to the cloud service provider while helping the company to focus on its core business. 

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Most cloud migrations are initiated to supposedly modernize the infrastructure with the objective to cut IT cost and speed up delivery. Is it enough to help business units generate revenue in the rising economy? That’s the question CIOs must ask themselves.

By hanging on their now obsolete role of infrastructure and tools provider, by resisting the change, CIOs are forcing BUs to embrace shadow IT, then outsource IT and ultimately adopt “IT without IT” business models as suggested by an increasing number of business performance strategists.

Conclusion

IT leaders must acknowledge once and for all that the highly competitive digital business that’s taking place is forcing BUs as to IT, to shift the concerns from technology efficiency to business value. In other words, they ask concrete contributions to business value.

IT leaders must acknowledge this reality: cutting IT costs and speeding IT operations is essential, but it’s not enough to help BUs make profit.

CIOs must get their agenda out of solution vendors, consulting firms, and technology research companies control. Wisdom recommends to listen carefully to what BUs expect.

I urge IT leaders, particularly CIOs, to seriously meditate this McKendrick’s truth:

But IT is but one small piece of the cloud story. A much bigger story is coming from the business itself. The curtain is now opening on cloud computing’s second act, which is all business. But this is also the hard part. Now, in this next phase of cloud, the emphasis is shifting to its value as a business solution. This is where it gets tricky to measure costs versus returns. Traditional measures cannot capture cloud’s impact on agility, customer satisfaction, business transformation and workforce satisfaction.

Make no mistake about it, IT without IT is one of the next IT standards. Managed ITaaS capabilities specifically thought to help businesses make profit is what’s needed to implement it.

Anticipate the change, adopt managed ITaaS now. The time you make your cloud’s business revolution is now.