Business and Market Strategy

Cloud Computing "Silver Lining" – Business Value Matters. Technology Not!

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Microsoft and The Telegraph hosted the “Cloud Computing” Silver Lining event earlier this evening in London. It was a good mix of panel discussions, round-table and networking event. It was hosted at one of the City’s most prestigious landmarks – The Gherkin which with its magnificent views from the 40th floor across the London skyline, was the perfect location to discuss the matters of “Cloud” computing. I was one of the fortunate 50 people who received the invite to listen and engage with a panel of Microsoft, Telegraph and other Industry speakers. I am trying to summarise some of the key thoughts from the evening in this blog post. The headline message which I would like to give here is that, “In Cloud Computing, Business Value Matters, Technology Does Not”


Cloud Computing is about Business Innovation – John Jester of Microsoft noted that, Cloud Computing is turning a new corner in 2011. CIOs, CTOs are no longer adopting Cloud Computing purely for cost savings purposes. Increasing number of organisations are now turning to Cloud Computing to gain new capabilities to make business successful. Cloud Computing is leading to new customer engagement models externally while also boosting new ways of employee engagement internally. He cited example of Global Microsoft CIO Summit to drive home the point. While in 2008 most CIOs reported CEO mandate of Cost Reduction, in 2010 most CIOs reported that, now their CEOs are demanding IT to play an Innovation Role. CEOs are now demanding CIOs and CTOs to drive revenue generation and maximisation opportunities. And Cloud Computing is a leading enabler of these innovative business models.

Cloud Computing Liberates IT Consumers – Dr James Bellini, Author and Futurologist commented on how the Cloud Computing paradigm is working on end user computing levels. He likened the Cloud Computing phenomenon as an enabler to free employees to become individuals again and approach and use IT as tool which which liberated not locked them in. He predicted that, “Work prisons of 20th century will disappear by 2020 thanks to the Cloud Computing phenomenon“. But Cloud Computing is not something entirely new. IT industry has seen a number of variations and forms of this over past decades. Close to my heart, the Airline industry has been a pioneer of Cloud Computing for a number of decades when it started to consume the Airline Booking processes per transaction model. Large mainframe operators such as IBM and Unisys served the airlines per Mips based on their consumption. On consumer level, Microsoft Hotmail Service has been in place since 1996 which is prime example of email and collaboration service in cloud. This was one of the question which I posed to the panel. 


So What is New about Cloud Computing Now? – Probably nothing is new in terms of concept. As I outlined in few examples above, the paradigm is around for decades. The major difference driving the adoption (and to some extent Hype) is that Industry has finally caught up with Technology, Tools and Instrumentation required to make Cloud Computing work at mass scale. We agreed at the round-table as well as during networking session that two factors have contributed in a major way to drive the Cloud uptake and popularity. 

  • As John Jester of Microsoft noted, “Anyone is now Connected Anywhere“. The power of network makes cloud consumption easy for large end user computing as well as B2C markets

  • Secondly, as I theorise, the Mobile and Tablet devices have finally crossed the threshold of affordability, intuitiveness, usability and desirability which has enabled business models which demand mass consumption of IT services of various forms on the go

  • Thirdly as  Phill Robinson, CEO, IRIS and Alan Lee-Bourke, CIO, The Wise Group noted the Cloud Computing is a better economic model for enterprises. It allows CIOs and CTOs to pass on the worry of say Server Management, Patching, Wiring, Cabling, Backing up etc to the likes of Microsoft and Fujitsu while they focus on tasks of higher business value for their organisations. Alan for instance noted emphasis on Data Modeling, Reuse and Effective Churn of Information to help business move forward.  

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    Major Cloud Computing Adoption Challenges – Matt Warman of The Telegraph noted and the panel and round-table acknowledged that, Security and Data Integrity are some of the biggest blockers for free-flowing Cloud adoption. Access and Control of Information is a major source of wealth creation of 21’st century hence it is little surprise that data and information assets are targeted by hackers and groups with not so noble intent. But we believe that collectively as industry and individually as responsible organisations these aspects will be sorted with priority. Some of the message from Microsoft Cloud Forum demanded Industry players to work closer together on security standards. While there are now also demands for Government to work a lot closer with Industry on boosting Public Sector Cloud Adoption. 

    The other notable issue raised was difference between commercial models for applications in cloud computing environment vs the collaboration services in cloud. For instance operational, governance and commercial model for making Microsoft Azure and Amazon web services work are of different complexity than say making Office 365 work for enterprise. Both present respective set of challenges but operating model for Cloud in these instances are different. 


    To summarise, momentum seems to be gathering around the fact that Cloud is now seen to enable business rather than just technology development. A great debate at a great location. Many thanks to Matt Warman of the Telegraph and John Jester of Microsoft for hosting a fantastic event!

    The State of CIO: Evolution of the CIO Mandate and Role

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    These days I am presenting the analysis of the State of CIO in this blog. So far I have summarised insights from a successful CIO in my 50 Things to Know Becoming CIO post, followed by analysis of the Priorities and Focus for 2012 and beyond based on the Harvey Nash CIO Survey.  In this post I will be analysing and summarising another influential industry survey from IBM. 

    The 2011 Global CIO Study – Essential CIO is a comprehensive survey of 3000+ CIOs across Public and Private sector enterprises. More importantly is spans 70+ countries and 18 industries. So this is well rounded view of the CIO function in its true sense and any regional, industry biases and variations are essentially balanced by sheer volume of variety of insights in this influential piece of data collection and data analysis.


    The key question which this survey is focusing on is, “How are technology leaders helping their organizations adapt to the accelerating change and complexity that mark today’s competitive and economic landscape?” The headline finding of this survey is “CIOs increasingly help their public and private sector organizations cope with complexity by simplifying operations, business processes, products and services. To increase competitiveness, 83 percent of CIOs have visionary plans that include business intelligence and analytics, followed by mobility solutions (74 percent) and virtualization (68 percent).“

    Lonely Tree by Evgeni Dinev

    The key takeaway for me from this insight is that the CIO and the IT function is no longer isolated or lonely in the evolving business and operational world. Rather the IT function and CIO role is stepping up to the challenge and evolving at similar or greater pace. The study classifies all the responses it has received in four distinct patterns called as “CIO Mandates”, namely Expand, Leverage, Transform and Pioneer. The editors of the report state, “These mandates were derived from iterative analysis, including state-of-the-art statistical and textual analysis of the thousands of CIO responses. It revealed typical response patterns associated with each mandate. Each pattern indicated a distinct approach to IT leadership derived from specific organizational needs.“


    The Leverage Mandate is about demand from organisations for high-performance IT which needs CIOs to focus on managing essential IT activities and getting information to decision makers faster and more accurately. 52% of the focus of CIOs with this mandate is to provide fundamental services while 28% is to manage and boost the organisational process efficiency.

    The Expand Mandate asks CIOs to focus on cross-enterprise growth while continuously tune business processes and internal collaboration to gain tighter integration. An overwhelming 98 percent of those CIOs said they would lead or support efforts to simplify internal key processes. A full 95 percent said they would lead or support efforts to drive better real-time decisions and take advantage of analytics.

    The CIOs with Transform Mandate look beyond the boundaries of the enterprise to simplify business processes and generate real-time insights up and down the value chain. Organizations that operate with a Transform mandate expect IT, more than anything else, to be a provider of industry-wide solutions to support business. The survey reports that CIOs with this mandate are expected to spend more than 33% of their time and budget on this focus.

    With a Pioneer Mandate, CIOs are seen as critical enablers of the organization’s vision and typically spend less than one-quarter of their time or budget on delivering fundamental IT services or business process efficiency. This group of CIOs ranked product/service profitability analysis and product/service utilization analysis as their top two priorities for turning data into usable intelligence.



    The report concludes by stating that, “Whether an organization requires an emphasis on delivery of essential IT services or challenges the CIO to pioneer new opportunities, CIOs need to innovate. With ongoing technological shifts, the seemingly endless onslaught of data and the increasingly frenetic pace of change, making incremental improvements to operations may no longer be sufficient.” 

    The message is loud and clear, The Role of CIO is Evolving. Innovative approaches to advance the business forward is IN. Efficiency improvements and “keep the lights on” are expected as “Business As Usual” and no longer enough to secure the seat at the Board. Modern CIO needs to be a true business leader who owns and manages to Technology to deliver true business value and advance the business forward.


    CIO Insights is part of IBM Executive Exchange which can be accessed here.


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