Adopting a cloud-first strategy presents many benefits, such as increased business agility and flexibility, as well as reduced costs. However, to fully realize these benefits your staff may need to acquire new skills and create or update core processes. While this reality may be obvious for DevOps, Infrastructure and Platform Management as well as other technical areas, changes necessary in the core business often get overlooked. Being aware and making these changes can maximize the business value and minimize the business risks of cloud adoption.
It is becoming common knowledge that cloud computing introduces a significant shift in how technology is obtained, used, and managed. Less well-known is that cloud computing also shifts how organizations budget and pay for technology services.
Cloud computing benefits businesses by giving them a way to:
- Trade capital expenses for variable expenses
- Acquire the advantage of increased economies of scale
- Make agile capacity decisions
- Increase business decision and response velocity
- Avoid spending money to run and maintain data centers
- Get out in front of customers in minutes rather than months
When engaging stakeholders, you must present a strong business case for cloud adoption, prioritize cloud adoption initiatives, and ensure that there is a strong alignment between your organization’s business strategies and goals and IT strategies and goals. While this strategy encompasses many more things than I can cover in this blog, you can start the journey by understanding these four items that you should consider when discussing cloud adoption with your Business Stakeholders.
Address your organization’s ability to plan, allocate, and manage the budget for IT expenses in the new cloud services consumption model. A common budgeting change involves moving from capital asset expenditures and maintenance to consumption-based pricing. The move requires new skills to capture information as well as new processes and automation to allocate cloud asset costs that accommodate consumption-based pricing models. To ensure that your organization maximizes the value of its cloud investments, you should consider deploying charge-back models to track consumption with new details, which creates new opportunities to associate costs with results.
Understand Business Alignment
Focus on your organization’s capability to leverage IT as a business enabler. Before the cloud, many organizations look at IT as simply “keeping the lights on”, ensuring that collaboration applications and line-of-business applications stay healthy and operational. Cloud services provide efficiencies that reduce the need to maintain applications, enabling IT to focus on business alignment. This alignment requires new skills and both new and selectively modified processes between IT and other business and operational areas. Your IT teams may need new skills to gather business requirements and new processes to solve business challenges.
Provide your organization with measurable the benefits received from their IT investments. Many organizations use Total Cost of Ownership (TCO) or Return on Investment (ROI) calculations coupled with budget management. TCO and ROI change significantly with cloud services. As mentioned earlier, cloud services offer new ways to directly link consumption with specific business processes. It is worth saying (or at least implying) again that measuring the value of technology investments becomes more meaningful when these investments can be directly linked to usage and business outcomes.
While this hurdle might seem most nebulous of all (entire careers are built on it), it is nonetheless unavoidable and critical. You must focus on your organization’s capability to understand the business impact of preventable, strategic, and external risks to the organization. These risks can stem from the impact of financial and technology constraints on agility. The good news is that organizations find that moving to the cloud reduces or eliminates risk constraints. Taking full advantage of this newfound agility requires teams to develop new skills to understand the competitive marketplace and potential disrupters, and to explore new processes for evaluating the business risks of such competitors.
The journey to cloud adoption is always all-inclusive and evolving. While the cloud revolution has been a reality for quite a while, we are just now seeing a “tipping point” that seems to be creating a gravity, drawing in different organizations of varying sizes and varying goals. For organizations who do not consider themselves early adopters, we think that understanding the business reasons first can catalyze the overall adoption process.
With an experienced eye and the right perspective, businesses can align themselves with the full technical benefits of the cloud without missing out on opportunities to improve the overall business.
Let’s chat and talk about your unique needs and challenges. We want to hear from you.