In the not-to-distant past, any C-suite conversation about implementing new technology began – and usually ended – with a question about how the new technology would reduce costs. Those days are coming to an end, especially when the conversation is about cloud computing. And the shift in thinking has been remarkably fast.
According to the TechTarget Fall 2013 Cloud Pulse survey, 45 percent of IT leaders pointed to “business needs” as the key driver behind implementing a public cloud solution. Only 29 percent said cost savings was the main reason. This is a major reversal from the 2011 study, in which cost was identified by nearly three-quarters of respondents as the top reason for using the cloud.
This change in mindset has a lot to do with the evolving role of CIOs and technology in general. CIOs are no longer simply procurers and caretakers of technology, and technology is no longer viewed as a set of physical tools that enables enterprises to reduce costs. IT is evolving into a critical component of business strategy and growth.
With IT assuming a more influential role in strategic business decisions and direction, cloud adoption is on the rise. According the Future of Cloud Computing Survey led by North Bridge Venture Partners and GigaOM Research, 75 percent of respondents were utilizing some type of cloud service in 2013, up from 67 percent in 2012. The study also revealed that business priorities (52 percent), not IT priorities (36 percent), are more likely to drive the adoption of cloud-based applications.
While more organizations than ever recognize the business advantages that the cloud is capable of delivering, only 43 percent are realizing the benefits, according to a Gartner study. In order to take full advantage of the cloud, organizations need to change how they operate in a way that reflects IT’s increasingly important strategic role. This starts with reevaluating IT budgets and allowing CIOs to have a stronger voice in shaping business strategy. Similarly, CIOs need to actively look for opportunities to use the cloud to improve business processes and generate revenue.
Making IT decisions with the goal of cutting costs is a lot simpler than making decisions that are aligned with business goals and processes. Instead of simply looking at spreadsheets, organizations must be willing to adapt business models that allow them to use the cloud to create competitive advantages. The cloud is capable of knocking down silos, enabling shared business processes across organizations, and allowing organizations to view and serve customers from different perspectives.
In a nutshell, it’s not enough to add some cloud services to your existing infrastructure, save a few bucks and call it a day. The most successful organizations are taking a strategic approach to cloud adoption in order to truly move the business forward.
The IPC Technologies team includes Chief Technology Officers who have driven IT strategy for Fortune 500 organizations and large government agencies. Contact us to put their expertise to work in your business.