The growing impact of digitalisation is forcing enterprise leaders to reinvent their business models to thrive. Speculation abounds over what it will take to succeed as a next-generation business – some will say agile, disruptive and customer-centric; while others suggest it will take innovation and data-driven approaches. Whatever the end result, it’s clear that businesses are increasingly relying on cloud computing to gain the agility, flexibility and scalability needed to adapt and prosper.
By allowing companies to consume compute resources as a utility through the internet, true cloud computing plays a key role in building competitive advantage by accelerating the rate of innovation for a business, as well as reducing IT operating costs to free up capital and personnel to innovate on new ideas quickly. In addition, the scalability of the cloud enables businesses to cope with the rapid proliferation of data generated by new technologies and initiatives, particularly the Internet of Things (IoT).
Once charged with simply “keeping the lights on", the cloud gives CIOs the opportunity to play a far more strategic role in business direction and growth – delivering innovative systems that ensure measurable returns in business value and competitive advantage from IT investments.
New world of opportunity
While it seems surprising now, it wasn’t that long ago that CIOs debated the value of cloud computing. While some were fully behind it and saw it as empowering; others were resistant to change and sceptical, seeing it as a threat to their traditional role. According to a 2009 BT Global Services Enterprise Intelligence survey, 53 per cent of CIOs didn’t see how cloud could save money, despite its potential to reduce or eradicate capital expenditure requirements.
Fast track to 2014, BT’s Art of Connecting survey indicated that 64 percent of CIOs now identify cloud as critical to delivering commercial results for the business.
Virtually every CIO can tell IT war stories of cost overruns, integration nightmares and version lock associated with the costly, lengthy and disruptive upgrades to outdated legacy technologies.
With the benefits of lower upfront investments, rapid deployment and ease of maintenance now generally accepted, the move to cloud no longer needs the justification it once did. Virtually every CIO can tell IT war stories of cost overruns, integration nightmares and version lock associated with the costly, lengthy and disruptive upgrades to outdated legacy technologies. These issues are now becoming a distant memory for many CIOs, as cloud providers take on the responsibility of maintaining and upgrading systems on their behalf.
Liberated from the endlessly laborious IT tasks that on-premise infrastructures require, the cloud gives CIOs a new opportunity to fulfill their strategic objectives. Enterprises gain the agility to launch new ventures at a fraction of the time and cost previously required. They can channel resources into leveraging mobile and social business technologies to strengthen relationships with customers and suppliers. They can grow analytics practices to turn big data into business insights. Their IT team can move out of the ‘engine room’ and take on a more value-added, business related role within the organisation, rather than being a bottle-neck dealing with low-level menial tasks.
Consequently, CIOs are now morphing into chief innovation officers that play an instrumental role in optimising the way their organisations operate to improve efficiency, delight customers and fuel growth, while addressing threats and gaining advantage over competition.
While the digitally connected world does create many new opportunities for CIOs, it also creates new challenges, such as how to scale resources to accommodate the proliferation of data generated every day; or how to build business intelligence solutions to analyse that data. The cloud delivers the agility and scalability needed to tackle these challenges head-on.
Working with other lines of business
There’s one area worth noting that does threaten the CIO’s role if not managed properly – the rise of shadow IT. Given the ease of use and potential of the cloud, as well as the plethora of different applications that are easy to access and subscribe to, some executives are inadvertently creating their own technology strategies without involving the CIO in their decision-making process.
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It is essential IT staff and lines of business executives maintain strong communication to avoid shadow IT.
CIOs must work alongside other leaders to ensure there are approval processes and procedures in place that satisfy demand for cloud solutions, while also ensuring the overall technology strategy delivers value. The key is to have an element of control, without becoming a barrier to the disruptive innovation potential of the cloud.
Thinking about IT in a different way
What’s clear is that cloud computing requires thinking about IT in a different way; something CIOs struggled to achieve in the past due to the difficulties of managing on-premise IT infrastructures.
For CIOs that embrace the shift from a more operational to a more strategic role, the rapid growth of cloud computing offers them an unparalleled opportunity to play a more involved role in the direction and development of the business than ever before.
Lee Thompson is a senior vice president and GM, Asia Pacific and Japan for NetSuite.
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