Originally posted @ Gigaom Research 8/18/14
Cloud computing and the board of directors may seem like an odd match. However, it is not the first time that executives and technology have met up. It may come as a surprise, but those magazines in the airplane seat back pocket are influential for technology. An airline publishes their magazine in which features about the latest innovation have influenced the direction of technology for years. The inflection point of a technology going mainstream often happens when it becomes the magazine cover story. An executive reads the article and asks when their company can leverage said technology.
Cloud goes mainstream
Using this methodology, cloud computing’s inflection point to mainstream took place in May 2009 when Continental Airlines (now merged with United Airlines) published a cover story on Russ Daniels, then HP’s Vice President and Chief Technology Officer, Cloud Services Strategy. Surprisingly, cloud was still very much in its infancy in May 2009. Corporate IT organizations were neither broadly discussing cloud nor planning wide-scale adoption. That was five years ago.
Fast-forward five years later to August 2014. Over the past several months an interesting trend in cloud is starting to emerge. While cloud continues to be a discussion point among executives, the board of directors is now raising the topic of cloud.
The Chief Information Officer (CIO) is already under pressure to adopt cloud among an increasingly complex IT portfolio. And now the board of directors is asking their CIO about cloud adoption. Ironically, the overall adoption of cloud continues at a rather sluggish pace.
Is the boardroom the right place to discuss a company’s wholesale cloud adoption? Probably not. Cloud does present the single largest lever for the CIO to help catapult the company forward. Which specific tools are used and how they are applied does affect business strategy. However, at the end of the day, cloud is still just a technology. Technology is a tool, not a strategy. Nor does simply employing cloud result in a magical business windfall. Connecting the dots between cloud and business is a bit more complex.
Upping the ante
The board of directors asking about cloud should not be a surprise. Cloud is a technology, but is widely used across both consumer and corporate worlds. Cloud also spans industries and geographies. In many ways, cloud represents a wide range of solutions to a quickly changing landscape. Conceptually, cloud is a broad solution to a number of problems. So, why should the board of directors not be interested in it? The problem is not that it comes up in a board meeting. The problem is in who brings it up: The CIO or a board member?
In a related vein, shadow IT is seen as a response to a discrepancy between needs and solutions. This is very similar to the questions being asked by board members today. The pace of business is increasing and companies are looking for ways to break free of the constraints. To some, traditional IT is viewed as a constraint that must change.
As IT pressure increases, so does visibility up the leadership chain to the board of directors. Customers are already making purchase decisions based on the technology of one company versus another. Companies and their respective IT organization must adapt to this changing customer behavior through the use of Social, Mobile, Analytics and Cloud (SMAC).
Seeking relief from the pressure
Change is hard. The world of IT is not getting simpler; it is getting far more complex. IT organizations see this first hand every day and are seeking relief from the building pressure. However, traditional approaches are simply not enough to keep up.
Relief needs to come from non-traditional means. In many ways, cloud presents a non-traditional approach to the norm. It is important not to underestimate the amount of momentum behind traditional IT approaches. Looking back at the anthropology of IT, one quickly understands why.
The challenge for today’s CIO comes down to a few key items:
- Understand the Business: First and foremost, understand how the company makes money. It may sound simple, but understand the different value chains, opportunities and challenges. Look for opportunities to improve and/ or grow.
- Executive Engagement: As CIO, engage peer executives and board members at a business level. Up-level the conversation from that of technology to business.
- Balancing Innovation vs. Legacy: Strike a balance between quick adoption of new methodologies and management of existing legacy solutions. Specific to cloud, establish a holistic cloud strategy while maintaining a solid operational footing with legacy systems.
- Challenge the Norm: Traditional IT approaches are not enough to turn the corner. Look for new, innovative ways that change the path of inertia.
- Organizational Shift: Establish a vision that engages staff in the changes.
In specific terms for the CIO role, it could be more dramatic and mean the difference between relevance and extinction.