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 Next Gen CIO’s are Leading Today

I had an opportunity to speak about The Next Generation CIO at the Constellation Connected Enterprise conference a few weeks back, and the topic brought to light the theme of what really makes a CIO an effective business leader both today and in the future.  In my view, the skills required for the next generation CIO aren’t much different than what’s required today.  In line with what I presented previously on the subject, one must possess business savvy, leadership, relationship building, and social skills, have the ability to act as a consultant and integrator to the business, embrace the cloud and Shadow IT, and understand the power of data and mobile.  It’s also knowing that it’s all about the business and not the technology, a crucial skill for success.  All of the skills needed in the future are already present today in those CIO’s who are on the leading edge.  Therefore, if you’re currently embracing these trends and skills, then you’re already a Next Gen Leader.

A CIO, both today and in the future, needs to be a business leader, always focusing on how IT can be leveraged in growing and improving business capabilities.  This means the CIO needs to understand the business just as well as the other executives, while always speaking the language of the business.   That’s the Golden Rule I wrote about earlier this year, and if a CIO isn’t doing this when speaking with the other executives, then they’ll just be viewed as the “IT guy” and not a business leader.  Everything IT does needs to be focused on adding business value. It should not be about the technology, and that point is what has given the CIO a bad name in the past.  Truly understanding how technology can best be leveraged for business improvement is a requirement, but the CIO of the past didn’t always get that point.  Translating technology capabilities into new business and customer engagement opportunities is what sets the “Next Gen CIO” apart from the others.

The Next Gen CIO is a consultant to the business and an integrator, and should be embracing Shadow IT.  Embracing Shadow IT means you don’t require everything to come through a central IT funnel, but CIO’s and their teams can still add tremendous business value to these decisions with contract expertise, integration direction, security oversight, and vendor partnering among other things. This is where the consultant role also comes into play.  There is a great deal of innovation happening today that addresses specific business problems, and many times those in the business are the first to discover these new tools and approaches.  They have the most knowledge on value, so letting the business champion and drive discovery is a great approach that helps IT from having to say no. What does need to happen though is that IT needs to be included in the discussion, particularly on the points mentioned above.  Without it, the risk of having insecure applications, bad and expensive contracts, and data silos increases exponentially.

Lastly, a CIO needs to understand the power of data and mobile, and leverage the cloud as much as possible.   My team has been cloud all-in for many years, and the business benefits go way beyond pure costs.  The speed in which we gain access to new product functionality, while significantly reducing our in-house development staff has been transformational.  On the infrastructure side, we’re almost out of the data center business and are relying on the mass scale and capabilities of others to meet our needs.  Unless your company is in the hardware business, moving your infrastructure to the cloud, whether pure public or hosted private, is a requirement now and in the future. In addition to the cloud, a Next Gen CIO recognizes the demands, and capabilities of mobility and data. Using data to make critical business decisions is not a new concept by any means, but the availability of new data sources  in the digital and Internet of Things world, and the amount of unstructured data being consumed has made this more critical and complex.  When talking about transformation, digital business, and new business capabilities, leveraging data and the insights it brings is even more important.  Helping the business take advantage of this data trove is a capability that will make IT critical for business success.

New skills are definitely required in the future but I believe that future is already here for many CIO’s that already have these skills.  Are you one of them?

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.