The organizational impact of Cloud

Posted on Wired Insights on November 8, 2012.

Cloud computing is about technology changing the way we do business, but this cannot be done without changing the organization. Being able to fully reap all the benefits described in previous Wired blog post 5 Cloud Business Benefits organizational changes are required. Successful adoption of cloud services is about a cohesive triangle of technology, business and organization.

Organization

Mostly cloud computing is discussed from a technical angle, but there’s much more to it! Cloud computing shouldn’t be about technology at all I feel, it should be about business value. When you truly look at cloud computing, most technical details are not that relevant anymore for most; It’s about utilizing a services with predefined service descriptions at predefined service levels. But for an organization to reap full benefit from cloud servers, organizational changes are needed. This is often overseen, but essential to understand and take action on.

ITIL processes

ITIL processes like change management need to be adapted to prevent them from becoming a bottleneck.Let’s say you want to start using a new web service, being able to use the service only five minutes after requesting it seems brilliant! But when the change processes are still designed for traditional delivery times, the net effect will be far less spectacular. Although the actual provisioning of the service takes minuets, the traditional approval, planning and change cycles can still ass weeks.

Management System

Also, the traditional management system only manages a handful of larger contracts, managing service level compliance of customized contracts periodically with a limited set of providers. With cloud computing the amount of service contracts will grow to the dozens, provided by dozens of different service providers at mostly standardized – non negotiable – contract terms. This makes it harder to manage each of the services individually, determining the adherence of each of the services to the agreed service levels. Service contracts will also be more diverse and less tuned to your organization, making it more challenging to grade them all alike.

Roles & Responsibilities

Than there’s the change of roles and responsibilities. Cloud services deliver managed functionality, therefore less technical roles are required. And new roles will emerge, like technical engineers for PaaS services and functional managers for SaaS services. I also expect that this will slowly decrease the gap between business and IT, with service architects in the middle. IT will not be responsible anymore for managing bites & bytes, but to add value to the business units.

Skills

This will impact the skills required of both IT and business. The IT organization will gradually require less technical skilled employees, shifting focus from technical knowledge to service orchestration. The business units will also need to develop understanding on how cloud services can be used, while maintaining governance and integration with the rest of the IT landscape.

To have the power at your fingertips is one thing. Knowing how to use it is something else!

2 Comments Add yours

  1. http://twitter.com/bg_enterprise/status/267737305773666304

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