Ron Stuart, Manager AoG Supply Strategy, Department of Internal Affairs (NZ)
Increasingly, innovative organisations both public and commercial are looking to an ideal and successful cloud based strategy. Creating a successful and sustainable cloud services strategy depends not only upon the identification, but also the development and sustainable deployment of a number of diverse elements. In this article I share some elements, based on real examples thatwill lead to the establishment of a sustainable cloud based strategy for your organisation or ecosystem.
“Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat.” —Sun Tzu
Cloud Computing is a Strategic Journey
A cloud computing strategy (whether it be public, private or hybrid) is about enabling organisational agility and accessing innovation. It is expected that organisations, or systems of organisations such as government (ecosystems of organisations), will migrate more and more of their internal technology to cloud computing over time.
"A cloud computing strategy (whether it be public, private or hybrid) is about enabling organisational agility and accessing innovation"
The model is compelling; cloud computing can improve flexibility, scalability and cost management as well as providing access to innovation through identification of new applications and software as a service (SaaS) products. Organisations or ecosystems best able to realize the potential of cloud services will establish a cohesive business strategy and transform theirentire organisation or system people, processes, and systems. If executed well, this journey can pave the way for significant cost savings, innovative new products, optimized business processes, and improved controls for cloud computing users. For technology providers, cloud computing can provide an opportunity for new revenue streams, mission critical service offerings, and superior brand recognition.
Success Factors for a Cloud Computing Strategy -how will you know that you have been Successful?
There are a number of questions that you will need to answer if you are to be successful in this strategic journey. The intention of this paper is to firstly ask these questions and to provide a series of responses in forthcoming issues to help you address them for your own organisation:
- Do you understand that cloud computing is a business strategy not a technology strategy? And that it is essentially an outsourcing strategy?
The shift to a cloud computing strategy effectively acknowledges that technology is a business enabler, not an end point in itself.
- Do you know if your organisation or your ecosystemis ready, have you thought through the consequences?
Is your current model based on ‘design-build-operate’ principles with on premise development and deployment? If it is based on these principles there is much work to be done to prepare for the change.
- Do know how to consume cloud services and how to make them available for your organisation or ecosystem?
Have you developed any form of cloud service brokerage or marketplace technologies than can be accessed by your business? How do you think you can consume cloud services if you do not have the appropriate mechanisms? Have you considered the impact and potential value of cloud services procurement? Have you considered the opportunities to develop a Cloud Services Marketplace with service aggregation and service orchestration capability?
- Have you developed a workforce strategy and do you know what skills and competencies you need to implement this cloud computing strategy?
If your current model is based on ‘design-build-operate’ principles focussed on on- premise development and deployment you will most likely not have the optimum set of skills and competencies to deliver a cloud computing strategy. The skills required for cloud services consumption are very focussed on the concept of ‘business brokerage’, defining the need of the business and managing the outcomes of cloud services suppliers.
- Do you know how to engage more effectively with your suppliers?
Do you still operate in a ‘design-build-operate’ environment where your organisation negotiates component price and assembles unique technologies? Cloud computing involves purchasing ‘Commercial off the Shelf’ (CoTS)capabilities based on global consumer pricing this changes the relationship with your suppliers!
- Do you know what to do with the information that cloud service delivery will provide you?
Potentially cloud service marketplace models, with their focus on subscription licensing models give significantly greater access to consumption information and will enable you to identify value or non-value quicker. Do you have the information management and advanced analytics capabilities that will enable you to identify and deploy value adding innovation quickly?
- Do you have the commercial governance models in place to make the strategy successful?
Change strategies and delivery fails when there is a lack of sponsorship at a governance level. Do you have the most appropriate governance in place to accelerate investment decisions as well as the ongoing rigor around demand and supply management?
- Do you have a trusted change champion to lead the strategy?
Change strategies fail when there is a lack of visible and trusted leadership. Do you have the change champion, the “honest broker” in place who is trusted by all parties to optimise the outcome fairly?
Understanding the Consequences
The consumption of cloud computing services is an organisational or system strategy that has significant intended and unintendedconsequences and therefore requires considerable attention:
- It is about innovation and disruption that will require different skills and capabilities do you know what skills and competencies you need for the future?
- It is about enabling the business to identify and consume technology capabilities and capacity that add value to the outcomes of the business– do you know what outcomes your cloud services strategy will deliver to the business?
- It is about determining the future role of the organisations ICT shop what is the future role of ICT in the organisation or in the ecosystem?
- It is about realigning the workforce to achieve and sustain the seeming advantage of cloud service delivery what innovations are available through cloud services to transform your organisation and how do you procure these capabilities?
- It is about changing the organisational culture what is your culture and does it support the delivery of the cloud services strategy?
- It is about value, not about ‘cost-out’ how do you identify and manage value?It is about understanding the role of suppliers as partners it is a different world and you need to reform your key and critical supply relationships are you ready?
- It is about understanding and managing information provided by the cloud computing service providers how will you collect and manage supply information in a subscription based world where capabilities are turned on and off at pace?