Moving to the Cloud is Critical for IT Effectiveness

As a technology leader in Silicon Valley, I always wonder whether we take the innovative cloud approaches here for granted, yet the real value of the cloud is so compelling I still find it hard to understand why there is still resistance anywhere.  I’m constantly reminded that there are many CIO’s who are still slow to adopt the cloud or not taking advantage of its huge potential. Yes, regulatory hurdles can’t be taken lightly, nor is it a straight forward endeavor for very large companies with a lot of legacy applications.  However, this doesn’t mean that CIO’s should use those challenges as reasons to not move to the cloud as much as possible.  Take Office 365 for example.  At this point, no CIO should feel that hosting their own exchange server adds anything to their business bottom line.  Eliminating non-core IT activities like hosting your own email service needs to to be a primary goal for CIO’s as we focus on activities that directly help grow the business.  Moving to the cloud is critical for true IT effectiveness as it brings a business focus to the IT organization, provides business agility, increases security, reduces organizational upgrade costs, and enables innovation.

Business Focus – Moving to the cloud gets the IT organization out of managing the infrastructure needed to run and manage the business technology.  On the application side, going with a SaaS first mantra reduces the development and customization efforts of the IT organization.  The SaaS industry is mature enough today that many of your application needs are available in some form.  Yes, you can’t just move off your legacy application overnight, but with a SaaS first approach, you replace the legacy applications as they reach their end of life. You might end up going with a platform that does require some configuration and modifications, but the efforts involved are much less than doing the development yourself.  Managing the code and the related upgrades are eliminated or greatly reduced.  Additionally, the hardware required to run these applications no longer become your worry and the time savings lets your team focus on activities that directly impact the business strategy.   On the pure infrastructure side, what business value is there is owning and maintaining your own hardware?  Yes, most organizations are highly virtualized now, but moving to an IaaS driven model is much more than just having a virtualized environment.

Increased Agility – In today’s fast paced world where new disruptive competitors are quickly popping up everywhere (thanks to the cloud, btw), increasing your agility capabilities is critical, and the cloud goes a long way in achieving that strategic objective. Every start-up I come across runs their business in the cloud (mostly AWS), so why does it work for them and not for the enterprise?  Whether it’s M&A activities, calendar based spikes in customer interactions, or even steady growth, you’ll never be able to respond to big strategic business shifts as easily as you could by leveraging the cloud.

Greater Security – There is a lot of buzz about the potential security risks of using the cloud, but the cloud in fact increases your security capabilities.  This doesn’t mean you ignore where you data sits or you don’t ensure employees treat your data with security in mind, but the capabilities in place for securing this information in the cloud is typically greater than what you could do yourself.  I’ll never be able to afford (nor find) the talent needed to secure my infrastructure as well as many of the cloud vendors can.  Security and reliability is the foundation for their business and they have the resources to stay on top of it in ways you could never do.  Most of the significant security breaches these days are with companies that run their own data center.

Reducing Organizational Upgrade Costs – In a true SaaS environment, the periodic (typically semi-annual) upgrades require significantly less effort and testing.  They’re done with very little fanfare and with very little impact on the customer.  Contrast that with on-prem software that requires not only the oversight and testing of the software, but also the infrastructure.  For internally developed and customized applications, it’s even worse.  The upgrades can be extremely time and resource consuming, extracting a huge cost to the organization.

Enabling Innovation – The time and effort required to stand up and implement most cloud applications is a fraction of that for onprem or customized apps.  Additionally, the functionality and availability of new and innovative business solutions popping up daily is a huge innovation enabler.  The use of cloud apps and infrastructure greatly increase innovation when fostered and embraced.

Notice one thing that’s not on the list? Cost! Cost should not be top reason for moving to the cloud as an apples-apples cost comparison is only relevant when considering the factors above, plus other intangibles.  Don’t get sucked into the cost trap.

If you’ve been slow to adopt the cloud, it’s time to move and increase your IT effectiveness.

The CIO as a Consultant, Evangelist and Innovator

big bangThe evolving nature of the CIO’s role is a hot topic these days as technology becomes an essential part of every business.   This evolution is required as many CIO’s had traditionally been focused on operational issues and risk avoidance, along with a smattering of growth enabling projects. While risk is still very important with an increase in cyber security and with operational issues abundant, the cloud provides plenty of services for helping manage both risk and standard operations. This frees up today’s CIO to focus on more strategic and innovative projects.  So, what does this really mean for today’s CIO, their role, and the skills required to be successful?

Last year, I gave a lecture at an Executive Development Program, where I presented on the CIO of the future.  In reality, it was really about what the CIO should be today, not in the future.  Specifically, I said that some of the skills and roles required for today’s CIO were:

  • An evangelist for innovation and agility
  • Acting as a consultant to the other business groups
  • Being a business enabler
  • A social champion
  • Having the ability to make the complex seem simple.

There were others, but these are what stand out to me as I reflect upon what is really needed today to be a successful CIO.

At the top of the list is that the CIO needs to be an evangelist for innovation and agility.  Innovation and agility are front and center and required in today’s fast moving business climate, and the CIO needs to be right there leading the charge.  This doesn’t mean that the CIO is going at this alone as that won’t be successful.  That’s where the evangelist side comes in.  Coming up with new digital business opportunities, championing new projects, leading by example, and evangelizing change are all part of what a CIO needs to be doing day in and day out.  Change doesn’t happen overnight so persistence is definitely needed.  Driving transformation within IT is critical as the IT department should  be ground zero for change and agility, but these themes need to become pervasive throughout the organization for true change to happen.  Moving the culture away from accepting the status quo needs to be pushed throughout the company.  That’s where today’s CIO can shine.

When talking about the new roles a CIO needs to play, being a consultant to the other business groups is one of the most important.  One of the biggest knocks on corporate IT in the past was the culture of saying no.  This was typically the case when everything had to come into a centralized world and the IT department had to control all software, whether internally created or externally purchased.  There was usually more demand than IT could handle, causing the word no to come out more often than it should have.  Long, drawn out projects became the norm, resulting in the rise of rogue IT where the business went off and procured software on their own.  In today’s fast moving world where enterprise class SaaS applications can be purchased with a credit card, this centralized control-center IT world is no longer necessary and an inhibitor to innovation and agility.

Today, the CIO needs to accept that there are great cloud technologies available and the business no longer needs to go through IT if they don’t see any value provided.  This is where the CIO needs to be the consultant to the other business groups.  The CIO shouldn’t be saying no, but instead be working closely with the business to consult on how an application will integrate with other systems, provide expertise on due diligence, contracts, security, and vendor capabilities, and advise on how the application can be quickly implemented without unnecessary bureaucracy or risk.

All of the above then empowers the CIO to be a business enabler.  Not only should the CIO be consulting on integrating cloud apps, they should also be looking for other innovative ways for the business to grow.  They should be speaking with customers to get a better understanding of what the customer really wants and how they might better interact with the company.  A good CIO can then use their experience to help champion new digital ways of engaging with the customer, enabling business growth.  The CIO holds a unique position in a company as they get a view into every business group and all the critical processes, both internally and externally facing.  If they really understand their business, and if they’re aware of the digital technologies available, they should have the ability to truly identify where the potentials exist to enable new business opportunities.  This digital mindset should also be internally focused, improving employee satisfaction and productivity. The CIO should be thinking about this every day.

To be truly effective though, today’s CIO needs to be social.  This means they’re creating relationships with other business leaders, while at the same time pushing a social culture within the company and with their customers.  They should be active on Twitter, LinkedIn, Vine, Google+, and other social media channels, and interacting with peers inside and outside their industry.  Championing internal social tools is important. I’ve seen firsthand how internal social adoption can be a cultural challenge, but it helps tremendously to be able to demonstrate experience using social media and how these tools can be used successfully internally to improve productivity.  You can’t champion change without being a first-hand social CIO.

Lastly, a successful CIO needs to be able to make the complex sound simple.  They need to be able to simplify the complex world of business technology and explain what’s happening to business leaders in simple terms.  Not using acronyms and speaking in the language of the business is critical (see my post on The CIO Golden Rule-Talking in the Language of the Business).  If you can’t easily explain to a CEO how the cloud enables business agility without any technical speak, as an example, then you won’t be successful nor listened to when championing new digital business ideas.

If your focus or current skill set isn’t strong in any of these areas, think about how you get there.  Success in today’s quickly evolving world demands it.

Disruption – Overcoming Cultural Hurdles takes Patience and Persistence

As innovation and disruption continue to be leading themes in business and technology, one component that’s essential for success is that change needs to be a part of your company’s DNA. If not, patience and persistence better be some of your core traits. Today’s CIO should always be focused on building better business value through innovation, but change is hard for many companies. As the CIO for a very successful 60 year old investment firm, just getting acceptance that change is needed is a hurdle at times. However, we all know nothing good comes easy, and with patience and persistence, disruption is possible anywhere. Don’t give up.

Although not every company moves as quickly as a start-up, it doesn’t mean your company won’t come around so keep your dose of patience handy. I’m seeing firsthand how the consumerization of IT is not only changing our users requirements and expectations, but it’s also changing executive attitudes. Disruption is all around us and times are changing for every industry. Don’t also expect true disruption to come easy. If you’re championing fundamental change, keep after it.

I’ve championed change since I started at our company in 2007 and I’m currently leading some disruptive projects, but just getting to this point wasn’t easy. We recently completed an extensive cloud ERP implementation that ripped out many of our legacy apps and drastically improved our core processes. After completing the implementation last fall, we reduced our application footprint 63% and our infrastructure needs 35%. We automated and digitized our major end-end processes. Additionally, we’re now truly set up to move to a zero footprint infrastructure by the end of this year. These are huge wins that have raised our firms’ disruption quotient significantly. We’re also now full steam ahead with new major changes, moving our whole document management foundation and key related processes to Box, while also integrating our processes to electronic signatures throughout our organization, both rarities in our industry. We’re a very complicated company structurally, with significant document centric processes driving our core processes, and these newer disruptive projects would not have gotten off the ground if it wasn’t for the push to strive forward despite delays, setbacks, and resistance to change.

How was this major feat accomplished? Our company was able to make such a tremendous transformation because the foundation was laid years before. We had successfully been using a cloud first strategy for over 5 years, so we were already focusing on critical business objectives instead of managing servers and infrastructure. Moving to a predominately cloud based environment had opened the eyes of many in the company on what was possible and the business value of such a move, but the full digital impact hadn’t been fully felt yet. There was, however, an appetite for a new way of doing things if it meant getting work done more effectively. One of our biggest hurdles in overcoming change was altering the culture of unyielding perfection in everything we did.

Moving your applications to a SaaS based environment does mean giving up on “nice to have’s”, at least initially. This clash is a good thing for many businesses though, as it forces a company to focus on what is truly core to their business. With customized, in house developed apps, there is always a tendency to accommodate and build every feature asked for. With our cloud ERP move, the focus was on ensuring that the core processes were accommodated and supported day 1. This new way of thinking was very transformational for us. The lesson learned here is to ensure that you’ve worked closely with the business in focusing on what’s core to success. Get to your change event as quickly as you can so you can begin learning from it.

To disrupt a company’s “change culture”, it will be important to get buy-in at the top. There can be small wins and some change without it, but true organizational disruption needs senior executive buy-in. If there isn’t an appetite for this at the top level, then there’s automatic cover for any senior executive who is resisting change. The result is too much headwind for a successful endeavor, so persistence in leading change is critical.

Building partnership and trust with the business is also needed here. This has always been a key critical competency for a CIO, but change requires it; you can’t go it alone. Once buy-in as been established, communication continues to be critical when going through change. Just because it was endorsed by the CEO doesn’t mean every manager or employee understands what is happening, or why. Old fears are hard to break and non-productive behaviors are hard to change. Ensure there is proper top-down communication early and often. Changing a company’s culture is hard, but nothing worthwhile is easy so don’t give up if you find yourself swimming upstream sometimes. Build the relationships, demonstrate the value, and keep after it.

Digital Disruption Comes to Life

I attended a great conference recently on digital business disruption that was put on by Ray Wang and the Constellation  Research Group.   After attending the annual Gartner Symposium last month, I was starting to feel that the terms digital business and digital disruption were getting over used and over hyped.  However, at Constellation’s Connected Enterprise conference, there were many great examples of disruption presented by a wide range of forward thinking business leaders.  These were people leading this disruption along with industry thought leaders.  Though Gartner’s view of a digital business as the “merging of the digital and physical worlds” is fine, it’s the real examples that are meaningful in understanding the disruption that is happening today.  It’s about using social, data, mobility and the cloud in driving change, leveraging these forces to interact with customers in new ways and improving how employees engage and work.  I believe it’s also about the consumerization of IT and the change being brought to enterprise IT.

My takeaways from the conference on digital disruption were:

  • 2015 will be a watershed year for the Internet of Things, with wearables making a true impact for the first time.
  • Old line businesses are really coming up with innovative and different ways of using digital technologies to open up new business channels, increase customer engagement, improve how companies interact with employees, and streamline the way they deal and operate with vendors and partners.
  • Thinking digital needs to be engrained in the company culture with a top-down push.  Projects can come up from the bottom, but the headwinds against real transformation can be strong without buy-in across the executive teams.
  • Every industry is being affected by digital disruption whether they are b-c or b-b companies.  There are many opportunities in every business for this to happen.
  • Those that don’t understand what’s happening and don’t reflect on how they need to change will be left behind and will lose to the competition.
  • Companies need to promote using digital in all aspects of their business to achieve the biggest gains.
  • To truly be digitally effective and disruptive, an organization has to value the use of technology in driving change.  As we’ve heard many times recently, every business is now a technology company.
  • Personalization and process change are just as important as a new business channel in the digital world.  It’s how you use mobile, the cloud and data, and how you interact with your customers and partners that are important.

Just a few of the digital disruption themes and examples presented were:

  • Using crowd-sourcing to build quick, low-cost apps in the federal government.  This was a great example of thinking digital and the government’s use of cloud to bring agility into the ecosystem of dysfunction is growing faster than you think.  There are many innovative technology leaders now involved, so you hope they can change how the government interacts with its citizens.
  • Using personalization to create the ATM of the future.  With mobile and digital the norm, banks continue to be hugely disrupted with they way customers want to interact, and personalization is very important to customer satisfaction.
  • Leveraging gamification in the restaurant business to help increase internal employee engagement and satisfaction, while reducing turnover.
  • A future of work discussion on how age is not the critical issue on how well  employees adopt digital business themes.  A person’s general digital proficiency and desire is key, while the company culture is also a very strong factor.
  • It was noted that 20% of the workforce is retiring in the next 10 years.  That has a big impact on the future of work and what work will be like in 10 years.  The change that’s happened over the last few years will only accelerate.
  • A data analytics example was a presentation on the historical trends in social mobility, and the realization that a deeper dive into the data of cause and effect can potentially help determine how to increase social mobility.  That’s an important issue affecting not just one business, but the whole country.  Another example was using data to predict how people might react to certain notifications, while potentially helping to automate the response.
  • Termed the “Notification Society”, the impact of mobility on our personal and work life continue to drive how we work and interact with each other.  There isn’t a business today that isn’t impacted either directly, or indirectly by the changing needs of the workforce.

A related topic that was heavily discussed, and one that is getting a lot of press these day, is the concept of the Chief Digital Officer.  A lot of chatter on whether there even should be a separate role, or should the digital role be called out within other leaders in Marketing or IT. In my view, the skills that a CDO needs may already be present in the current leadership team.  If digital means thinking about the customer, and looking to see how digital technologies can change the old physical way of doing things, then these skill sets should already be present in the CIO.  It’s still about focusing on the customer and increasing revenue, so these are things the CIO should already be doing. If not, then the CIO is more of an order taking, operational leader.

At my company, we are moving quickly away from the routine physical aspects of our business, using digital to engage more with our tenants, investors, partners, vendors and employees.  We’re trying new social media campaigns at different properties knowing that the trend in our industry is just beginning.

Every business has examples of how it’s being transformed by digital technologies with much more change to come.

The CIO Golden Rule – Talking in the Language of the Business

There have been many articles lately about different types of CIO’s, particularly one by IBM about CIO’s being split into two classes of leaders; strategic and operational.  The topic also continues to be front and center in many CIO conversations and conferences.  It’s a topic that I believe is very important, particularly as I continue to observe many examples of people who still don’t understand what the CIO’s real role is: a strategic business leader who focuses primarily on adding business value; whether it’s increased revenue, higher customer satisfaction, new business opportunities, or increased customer retention. To make this happen, a CIO really needs to always be talking the language of the business.  Conversations with other executives and business users need to focus on what they’re facing every day in their jobs. Talking to them in business terms is absolutely critical and one I call the CIO golden rule.

The relationships a CIO builds with the C-suite is critical to success and the conversations you have with them is a big factor towards building successful relationships.  Therefore, the conversations need to center on what you can do for the other business leaders, in their business terms.  How can you help them achieve their goals? What business problems are they facing, and how can you help them fix these problems?  These discussions should be completely about the business problem, not the technology.  Using technology acronyms or talking about the latest technology fad is a path to failure.

Additionally, by ensuring the technology projects have a direct business goal attached to them, the conversations about these projects will naturally center around a business context that will have meaning to the business executives and users. They will understand it and have a better appreciation for what IT is doing and the value you bring to the company.

I heard one technology executive talk recently about how she couldn’t get the CEO to understand why they need an Enterprise Service Bus. Hearing her say this sent shudders down my spine as that’s the type of conversation I would never have with a senior executive, let alone a CEO.  If your conversation is about a need, the business outcome should be front and center.  Not the technology.

To ensure you are always talking in the language of your business, it helps to do the following:

  1. Understand your business just as well as the other business leaders– As I’ve told others many times, my goal is to understand our business as well as, if not better, than the other senior executives.  This is critical.
  2. Know what the drivers are for long-term revenue – You know your business, but do you really know what drives revenue?  What are the levers that you can help move to increase revenue? Where will the company be in 1-2 years time, and what can you do to help get them there?
  3. Understand your customers – What do your customers want and what drives them to do business with you?  You can’t help increase revenue or improve customer satisfaction without really understanding your customer.  Better yet, go visit them.
  4. Know your employee base – Your internal customers are critical.  What hurdles are they facing in doing their job?  How can the applications they use be easy to use and intuitive?

The mission to speak the language of the business shouldn’t stop with you.  Getting your team to do the same is just as important.  As a leader, your team follows your examples and listens to your words.  I always hold periodic department meetings where I invite business leaders to speak about their specific area.  My staff gets excited by this and often come back to me for additional questions, so it’s an ongoing dialogue that is important to maintain.

To expand your team’s business knowledge, have them go through training conducted by the business groups.  New employees should attend training classes devoted to new business users.  Rotate them through short stints in the field if possible.  The goal here is not just understanding what the business does, but learning the language as soon as possible.

If your company is periodically mentioned in the press, make sure your employees see those clips and have the opportunity to ask questions. Highlighting press about the company and taking the time to talk to them in the hallway about these items is another reinforcement opportunity.

Everything above is done to ensure your teams don’t just feel a part of the business, but that they truly understand it and can talk in business terms.  It will make you, your team, and your company more successful.

10 Considerations for Your Cloud Contracts – CIO View

Having signed two more cloud contracts this month, it feels like a good time to share what I consider to be my top 10 considerations in negotiating a cloud vendor contract. As I was writing this, I had a hard time culling the list down to just 10. I’ve learned a lot over the years and have scars to prove it. There will be different views on this depending on whether you’re talking about SaaS, IaaS or one of the other horizontals in the space (PaaS, DRaaS,..), , but these 10 are generally applicable. So, here it goes:

1. Limit price increases – There is a lot of debate on whether or not moving to the cloud is actually cheaper than on-prem applications, and my answer is that “it depends”. There are many factors that must be considered (personnel time, upgrades, etc..), but license cost is a big one. What is a fact though, is that the longer the time horizon, the more expensive the cloud alternative can become. You’re paying a constant expense stream which can blow-up any ROI analysis over time. Other than negotiating the lowest initial price you can get, the best way to limit the cost over time is to reduce the pace and amount of future price increases. There are a few ways to approach this; the first being to go for as long a stretch as possible before the first and subsequent price increases. Most vendors will give you price breaks for longer contract terms. You might think this a risky approach as you’re committing yourself to a longer contract, but I’m assuming you’ve done your due diligence and are confident you’ve picked the right vendor. Even if things don’t work out as planned, which you absolutely need to consider, you’ll not likely be in a position to actually move off completely for 2-3 years. If negotiated right, the price increases will be tied to the contract length. The second part of this is to then ensure that each increase is as low as possible. I once negotiated a 0% first anniversary increase on a 3 year contract, basically holding my per user price flat for 6 years. I also negotiated a 5 year term with a 30 day out clause. No increase for 5 years and I can leave at any time. So my long-term contract risk is……..nothing. Try it; you never know what you can get.

2. Access to Data, Integrations and SSO – Some vendors are charging different prices depending on the availability of integration connectors or API’s, while others don’t charge extra for this capability. Even if you’re not starting out with a lot of integrations on day 1, you have to be prepared for the high likelihood of needing to get data in or out early on. Even SSO connections can sometimes cost extra to set up, or not be supported at all. If your cloud vendor is relatively new and doesn’t have published SSO connectors, make sure you include this capability in the contract at no charge. It’s in the vendor’s best interest to get this done and will help them in future contracts, so there is no reason for them not to include this. Integration and connectors are key for most successful cloud implementations, and a must for many, so it is frustrating that some vendors are charging extra for these. I get the tiered, a la carte approach that helps with revenue, but I think this is one area to focus on in your contract negotiations.

3. Flexibility on your license growth – On the software and platform side, the number of users will be a key factor in the ongoing cost. Having a good understanding upfront of your one and three-year growth scenarios will help you lock in lower prices on future growth. If you’ve hit a wall on the initial price, negotiating favorable discount tiers can help in the long run. The focus should be on having a low ceiling on your initial tier.

4. Exit strategy for data and access to data if the vendor fails – One difference in having your data in the cloud is the amount of control you have over it. So what happens if the vendor does go bankrupt? What if you do decide to move off to a competitor? A vendor failing isn’t a big concern for many of the top-tier providers, but it is something you need to think through and account for. I’m lumping this into your exit strategy for getting data out as it’s a similar issue. You need to understand how you’ll get access to the data and what your options are for getting copies. Ensure that you have some time to get your data out after your contract ends, in addition to language that ensures assistance from the vendor. Once you implement and once you get data integration up and settled, you’re already a step ahead in this process.

5. Development/Sandbox environments – If you’ll be making configuration changes to your SaaS app, or rolling out new apps or pages under a platform model, it’s important to understand the availability of sandbox or dev environments. The need is really no different than on-prem apps, but the type, freshness, availability and size of the data available are important, and can vary or be an extra price. Some vendors will apply this increase to all your licenses, so pay close attention to this and push hard to get as much included for free as possible.

6. Security – This is a very broad topic, so I’ll narrow it down to encryption and masking. Is data encrypted at rest? Is confidential data masked to those who don’t have proper access? For products that rely heavily on built-in uploading/downloading (storage and synch solutions), is the data encrypted during transmission? These are key considerations in comparing vendors, and you’ll find a wide variety of options available. Don’t assume that the biggest vendors are the most secure or encrypt your data at rest. It’s not as common as you would think. Data masking is also important for internal controls to ensure PII or confidential data is not visible. Not every vendor has this capability as standard.

7. Data Center Location – If you’re a U.S company doing business solely in the U.S., then your data center location will likely be in a region close to where you do business, if you’re dealing with one of the larger SaaS providers. For some of the smaller ones, you may not have much choice in the matter. For SaaS products, I have generally found the location to be not much of an issue within the U.S. It becomes much more complicated if you’re a non-US company or you do business or have offices in other countries as two issues then arise. First, latency in accessing your data becomes something you need to worry about so ensure you understand where your key users are for the app in question, in relation to where the vendor has its data centers. The second issue is around data residency and the various legal restrictions on where your data can be stored. This has always been something to consider, especially in the EU. However, the U.S. government data snooping scandal has changed the dialogue on this and made it a critical item to consider and deal with. It’s a topic that deserves its own write-up, so I won’t dive into the specifics here, but it needs to be on your consideration list.

8. Disaster Recovery Capabilities – Having applications in the cloud means you don’t need to deal with backups and disaster recovery yourself, but it doesn’t mean you don’t need to worry about it. Understanding your vendor’s approach and processes is important. Do they backup to facilities in other geographic locations? How long do they keep backups for? What are their RPO and RTO’s? Don’t ignore this just because you won’t be managing it on a daily basis.

9. SLA’s and Support – Up-time or issue resolution SLA’s are very important, but don’t expect a lot of flexibility in this area. The larger the company, the less likely you’ll get any movement. The top-tier vendors typically exceed their SLA’s but most will not budge from relatively low up-time percentages in the contract. Issue resolution response times vary widely, with many charging extra for quicker response. As a consumer of the service, I hate that model. They want to tell me my default is 2 business days for support unless I pay more. Really?

10. Storage and growth – The amount of storage is becoming a much smaller issue than it used to be, but it’s something you still need to understand and account for. If storage is a key part of the product, then you’ll likely be getting 1TB, or an “unlimited” amount of storage per user. However, some vendors still charge for storage. As with the growth of license counts, you need to understand your initial and future requirements so your future storage needs are accounted for up front. You’ll never have the same leverage as you do in the initial contract negotiations, so go overboard on growth requirements up front to be safe.

These are just some of the key items to consider. I know you’ll have others you feel strongly about, so feel free to chime in here or on twitter.

CIO of the Future: SFSU CIO Executive Development Program

Last week, I had the privilege of presenting to the San Francisco State Executive Development Program, which was aimed at aspiring CIO’s, along with current CIO’s who are looking to expand their knowledge.

My presentation was on the Future of the CIO.  I had great interaction and comments from the group, but what was most interesting was the many questions at the beginning about my “cloud first” strategy.  We spent 15 minutes just discussing the risks, challenges and overall value of the cloud.  Discussing the value and the great potential of outsourcing your non-core IT components to the cloud is a passion of mine, so I was surprised at the level of questions received.  Why go to the public cloud?  Aren’t you concerned about security?  More questions like these, which left me still believing there are a lot of companies and IT leaders out there who are still scared or uninformed about the value.

More on this later…

Below is a link to my presentation.

Why IT Still Matters and Rogue IT

There has been a lot of press and conversations lately on “Rogue IT”, particularly with the proliferation of BYOC (Bring Your Own Cloud).   It’s an important topic as it relates to the changing dynamics of IT, the core competencies of a CIO, and where IT can really add value to an organization.  IT still has a role here, and it will be most effective when playing the role of a consultant to the business.

First, the word “rogue” is not an accurate description of what’s occurring. The description implies a negative view of the relationship between IT and the business when in reality, it’s a an acceleration of technology innovation and capabilities. No longer do you need a central IT department to facilitate and lead every technology decision. The rogue term may truly have been negative many years back when business units would try to make IT decisions with vendors without involving IT.  It caused conflicts at the time and the tactics did not advance innovation, but that’s not the case today.

Today, it’s extremely easy for any user to cut a deal with a cloud company for almost any business capability or computing resource.  I’ve seen it many times.   However, this actually can be a good thing as it accelerates innovation and the solving of business problems that are so critical to an organization.  Where this falls down, however, is where the CIO or IT department is completely unaware or left out of the conversation. When this happens, important enterprise issues around security, data privacy, data integration, pricing, backups, SLA’s and many other important topics are typically ignored.

So, how should a CIO deal with “rogue” or “shadow” IT?  Embrace it!  Use your influencing skills to demonstrate to the other departments that what they’re looking at can be good, and powerful tools, and that they should use IT as a consultant to help them achieve their goals.  That’s the key.  You’re not there to say no, but probe and bring issues that will resonate with them.  Ask them how the information will be maintained (think efficiency). Will information be needed from other systems, or vice-verse (data quality and efficiency)? Security or backups won’t typically be of interest, but focusing the consulting view on what matters to them most will get IT involved in the end.  Once involved, the other enterprise issues can be reviewed, and it’s your job to do this without saying “no”.

So, embrace BYOC, BYOD, and the consumerization of IT and focus on solving business problems.  The users will begin to come to you earlier in the process.  You’ll get farther, you’ll be more successful, and in the end, the enterprise wins.

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