CIO Upfront: The terror of the 'Frankencloud'

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Getting cloud ‘right’ at the enterprise level is central to the work plan of the strategic CIO. The CIO needs to get it right because of the mess that characterises many cloud portfolios. 'Frankencloud' might be a cute term but accurately describes what plagues many digital transformation programmes.

Ovum Senior Analyst Laurent Lachal identified some of the elements of the Frankencloud in his November 2014 report ‘2015 Trends to Watch: Cloud Computing’,

It is a multi-faceted notion that relates to various ongoing issues such as:

  • Lack of standardization in the way cloud service providers define, package, and price, and deliver cloud services from IaaS to PaaS and SaaS.
  • The lack of integration between the various elements of some cloud solutions.
  • The need for enterprises to expand and consolidate their cloud projects, integrate and secure them, and optimize their use in areas such as cost, performance, and user experience.

Lachal expected problems with Frankenclouds to grow for CIOs and in his follow up report ‘2016 Trends to Watch: Cloud Computing’ observed,

Last year we pointed out the rise of Frankenclouds as enterprises fail to integrate and consolidate their siloed cloud projects. Frankenclouds will become even more a problem in 2016 as siloes multiply at all levels, such as architecture, applications, and organisation.

This means that most functional leaders are spending their way into cloud capability. As is so often the case, what is good at the functional level is less than good at the enterprise level. Cloud is one of the elements of the modern business environment that acts either an enabler or a constraint. The difference is how well the CIO manages his or her cloud portfolio.

Cloud is one of the elements of the modern business environment that acts either an enabler or a constraint. Rohan Light, Decisv

One of the CIO challenges is that the cloud industry is still evolving. As Lachal stated:

In 2016 the focus will shift from breadth to depth and from IT to business agility. It is taking a long time for companies to weave cloud deeper into their technology and organisational fabric, and optimize it at all levels from cost to security.

This makes it hard for centralised ICT to manage at the innovating periphery of the organisation. In this sense the Frankencloud is a necessary evil. Somewhere in the mess of enterprise cloud is the successful local model that will help the enterprise turn the corner. The trick is identifying which one and backing it.

This is a behavioural challenge rather than a technical one. Success emerges as a result of better business practice enabled by cloud capability. It’s about how the enterprise encourages different ways of working that leverages the transformational opportunity cloud provides. These opportunities aren't limited to how cloud impacts internal modes of operation. They extend out into the wider business ecosystem as Lachal notes:

Cloud is not only about IT providing a platform for the business to operate, but also and increasingly for the business itself to become a platform that delivers cloud-based services to an ecosystem of suppliers, partners, and customers. In this context, cloud leads to external, not just internal, cooperation across supply chains, and this will increasingly be the case in 2016.

Next: Navigating the modern business ecosystem

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‘Ecosystem’ is another important term for the strategic CIO to get comfortable with. Modern business ecosystems are complex, adaptive and networked. They are also in continuous flux, shifting with each disruptive digital advance. One of the more unsettling effects of this emergent world is uncertainty about the location of the centre of business gravity. Lachal pointed out:

As cloud-centric digital transformation blurs all boundaries, such as vertical market boundaries, cloud computing becomes the context for new partnerships as well as increased competition between vendors and between vendors and their customers. So think outside the box and partner with competitors along with customers across a variety of vertical markets to create new cloud solutions. These solutions should help enterprises shift from a SMAC (social, mobile, analytics, and cloud) stack to a MANIACS (Mobile, ANalytics, IoT, Ai, Cloud, Social) one.

It’s easy enough to buy boxes and sign up with SaaS providers, but it’s a much tougher ask to bring people up to speed in terms of their business beliefs and associated behaviour.Rohan Light, Decisv

This blurring of boundaries and increase in uncertainty challenges the strategic CIO to help his or her colleagues understand what digital transformation really means. And it’s a difficult journey as Dion Hinchcliffe notes in a March post on his blog,

The primary lesson here: Deeply understand the rules of digital ecosystems and build one that solves a real pain point for a lot of people. Optimize the results relentlessly and pour the returns back into growth. Don’t stumble along the way. This is a playbook that is simple enough to understand, but that most industrial era organisations don’t fully embrace in a meaningful way, despite all the marketing talk — and I’m guilty as many of us in this regard — about digital transformation.

Digital transformation is about the behavioural implications of organisations shifting to a MANIACS technology stack. It’s easy enough to buy boxes and sign up with SaaS providers, but it’s a much tougher ask to bring people up to speed in terms of their business beliefs and associated behaviour. Hinchcliffe,

The real obstacle is one which I’ve been exploring in various forms over the last several years: Most organisations have accumulated and/or designed in enormous amounts of legacy culture, process, mindset, and infrastructure that got them where they are, but now has to be undone to a large extent to be fully realized and effective digital organisations. The world of agile, lean startup, OKRs, open APIs, devops, relentless A/B testing, and growth hacking are all words or phrases sometimes heard in the halls of the average classical business, but they just don’t lie at the heart of them, and won’t any time soon.

This is why the cloud play is one of the most decisive options available to the strategic CIO. Somewhere will be a business unit that is learning its way to an effective means of moving past legacy business mind-sets. This business unit is likely to be an irritant to centralised ICT, as well their own functional colleagues. The task of the CIO becomes one of searching these groups out and identifying what behaviours to encourage and champion across the rest of the enterprise.

This means challenging the centre of gravity within enterprise ICT as well as influencing the development of emergent technological expertise. This breaking of the centre is an unavoidable task of the strategic CIO. Hinchcliffe noted:

Worse, we’ve greatly over-centralised technology enablement so that it’s become a profound chokepoint in many organisations. CIOs and CMOs feel this acutely when this is the case, and yet a few are now reaping the benefits of going in the opposite direction. There are indeed solutions, but they require more ideas that traditional organisations aren’t good at: Open innovation, Kickstarter-style ideation programs, app stores, customer co-creation, change agent programs, hackathons, employee incubators, BYOT, enterprise architecture that’s designed for loss of control, and more.

Lachal and Hinchcliffe point the way towards the value of cloud enabled network effects for the strategic CIO. Working with and learning from 'the cloud generation' provides the CIO with the option of enabling the enterprise to exert more influence into its business ecosystem by increasing its network connectivity. Cloud value becomes multiplicative outside the boundaries of the firm and this exposure will help change the legacy mind-set within the firm. Hinchcliffe observes how this plays out,

Most digital contenders fail to understand even the most basic concepts of digital, such as the network itself is the single biggest resource you can and must use to digitally fuel your ecosystem to transform. It will do almost all the work, as long as you have a vision, a value proposition, and a platform which truly embodies and orchestrates both. Network orchestrators, in fact, are at the top of the Internet food chain.

Getting cloud right for the strategic CIO means weakening the centre and sifting through the mess of the enterprise Frankencloud. It’s difficult and unpopular work that requires significant commitment to change. But if done well, it gives the enterprise a rare opportunity to move towards genuine digital transformation.

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Rohan Light worked at the enterprise level in Inland Revenue in a series of specialised roles in the risk, design, portfolio management and business group domains. He began to be consulted by business people on issues of strategy, management and execution, which led to the formation of Decisv. His formal strategy work led to teaching strategic thinking as an Associate at VUW’s Professional and Executive Development.

He cofounded the Enterprise Analytics Forum, a community of practice that meets to discuss issues relating to the fundamental challenges analytics poses to pre-digital business models. He extended his involvement in the analytics sector when he was appointed Chairman of the SAS Users of New Zealand.

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Copyright © 2016 IDG Communications, Inc.

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