This is the second of a three-part post on how cloud computing can be leveraged by businesses. In the first post, we defined cloud computing and discussed the ongoing shift to the cloud by many sectors and industries, including the US Federal Government. I think cloud computing is in its early stages but there are strong signs that the tipping point might be just around the corner.
IT organizations are increasingly seen as service providers rather than developers of business solutions and keepers of infrastructure. The relationship between the CIO and business leaders is becoming more collaborative and there is more natural focus on improving the “business of IT”. This relationship, coupled with capital-constrained times, is fueling changes to IT funding models. One of the reasons firms turn towards using cloud computing is that it gives them a simpler and more straightforward way of funding IT. If you have been involved in pushing for the IT projects budget or are familiar with how your company is controlling IT costs, you know what I am talking about.
Simple Pay-As-You-Go Approach
Is cloud computing cheaper than what traditional IT provides? Some would argue that over the long haul, software-as-a-service or platform-as-a-service will cost you more than running the applications in-house. I think it will be a long time before really reliable measures of the costs and benefits of cloud computing for corporations are available. What is driving business to the cloud is not about overall total cost comparison. Businesses want a cash flow friendly approach to IT funding. Cloud computing solutions offer that with its simple pay-as-you-go approach. You pay only for what you use; costs are directly proportional to your requirements. The ability to perform charge-backs to business owners based on their utilization of IT services is greatly simplified with the cloud model. This is difficult to imagine in enterprise software models where multimillion dollar, up-front capital expenditures for IT infrastructure is required.
Consumer IT and Business IT Convergence
Another major reason for the business move to the cloud has something to do with consumer IT. Information technology for the consumer world means eBay, Facebook, iPad, etc. IT was once the exclusive realm of the IT professional, but today, consumers have taken on many of the same roles. Vaughan Merlyn calls this “The Convergence of Consumer IT and Business IT” and he discussed this extensively in his blog. True, there is a big difference between consumers and IT organizations on the use of technology and the challenges that brings. However, technology today has brought IT literacy to many people and changed the way consumers communicate and work. Consumer familiarity with new technology that comes out everyday makes them more knowledgeable with technical tasks. This is the new reality for IT managers — having to pay attention to what users (IT consumers) want. This is where cloud computing becomes a tempting choice for IT. At this time of capital constraints, cloud computing provides an on-demand solution with more options and less implementation time. Perhaps, like me you are also wondering: when is the best time to venture to cloud computing and where do you start? I think the answer to the first question is NOW. As to the second question, let me quote Vaughan’s suggestion on this that came as a comment on my previous post:
“Don’t look to the cloud to do things you are already doing, but do them cheaper. Rather, look to do the things your business wants, but you haven’t had the time to do! That’s where the big wins are to be found!”
Has you IT organization or company ventured to using cloud computing for some of your IT and business needs? What has driven your business’ turn to the cloud? Share us your comments, questions and experiences here.
Photo by Hinnamsaisuy
Strengthening IT Accountability – Lack of Accountability, a Symptom of Lack of Organizational Clarity
A very insightful comment in my blog from a well respected IT management consultant, Vaughan Merlyn, motivated me to write this follow up article. IT Accountability is an interesting topic and there is a lot to uncover and delve into. In Part One, I wrote about accountability as something that does not only happen when things go wrong — it is taking ownership from the beginning. It is continuous rather than something that has an end point. There are three important areas where IT accountability comes into play: (1) IT Accountability in Operative Teams; (2) IT Accountability Cost Management; and (3) IT Accountability to improve service delivery. These are just three of the many facets of IT organizations where accountability is an important driver for success. They are meant to illustrate the meaning of IT accountability and to provide examples.
Part Two aims to tackle the challenges on how to deal with the problem of lack of IT accountability. According to Mr. Merlyn, lack of accountability is a symptom of a lack of organizational clarity. I agree withVaughan. The main reason why IT leaders fail to address the accountability issue is a lack of clarity on what the team is accountable for in the first place. Accountability matters as much as any other IT capabilities. The key to directing individuals and teams towards success is to clarify the organizational purpose up front. The organizational purpose is a declaration of what the organization wants to be and, in broader terms, what it wants to achieve. It provides meaning to the day-to-day tasks, triumphs and setbacks that make up the daily operative grind. A lack of purpose will create disconnection among the different levels of the IT organization. Teams and individuals will not know why their effort matters. They cannot connect their work to a larger story. Their work becomes a matter of going through the motions. When that happens, team members lose accountability.
The following statement is Vaughan Merlyn’s assertion on this subject:
“If organizational purpose is not clear (i.e., the goals, values desired business outcomes and guiding principles for a given capability are defined and well understood?) then organizational commitment (i.e., sponsorship and accountabilities) will be lacking or confused. With weak organizational commitment, ability (i.e., clear processes, well-defined roles, competent resources filling those roles, appropriate tools and technologies supporting the processes) will be deficient. And with deficient ability, there is virtually no way accountability (i.e., criteria for success and related performance requirements) can be meaningful.”
Root Cause: Lack of Organizational Clarity
When there is a lack of organizational clarity, it will be harder for IT managers to inspire people because they don’t have a clear direction, performance measures and objectives to follow and to communicate to their teams. This disconnect will open the door for individual managers to interpret directions, formulate objectives and determine their own priorities. On the other hand, for IT team members, it will lead to inconsistent performance of day-to-day operations that will cause low morale and productivity. It will be impossible to expect accountability from team members who may ask themselves the question—“How do we know if we are doing a good job? How do we know if we are fulfilling our obligations to the team and we are achieving results for the company?” Without organizational clarity, chances are you will have a lack of accountability from your people.
Creating the culture of accountabilty starts with the IT leaders – to me this process is always top-down. They define the IT strategy and vision based on the desired results and business strategy of the company (IT to Business Alignment). The desired objective of IT or the entire company could be to: become the easiest to conduct business with, be the most innovative organization in the industry, have technological excellence, increase profitability, or create the best sales and distribution network. IT leaders must clearly understand the business strategy of the firm which it provides services to. They must also work to provide the right IT strategy, platform, experiences and actions to achieve these results. The role of IT leaders is to communicate this organizational purpose clearly to the whole team. It requires persistent effort and a clear message to get the right commitment. By doing this, they can be certain that their subordinates know or are reminded what they are accountable for. This is where IT leaders make all the difference. Leadership is about reminding people what it is that we are trying to achieve—and why it matters.
Photos courtesy of Renjith Krishnan and Sheelamohan