Last week Adam Dodds, New Zealand's IDC Research Manager published an interesting note highlighting the ongoing uptake of cloud services - NZ CIO's have the keys to the cloud. While the growth highlighted will not be news to industry participants, the insights may be.
The insight I found interesting is around the challenge of scaling cloud consumption and the role of the CFO and governance in this journey - "CFO's must evolve a mechanism for the governance of the use of the cloud. 53% of NZ businesses are not tracking their use of Cloud, they are just using more."
What is governance? Why is it a challenge in the cloud era?
The dictionary definition includes "...exercise of authority; control." The traditional (or legacy) role of governance in IT services is twofold.
- Financial Management: IT viewed as a cost centre
- Business Continuity: IT services availability and security
At the risk of sounding like my Grandmother - they were simpler times, sunnier times. Then the clouds started rolling in...
Traditional governance is obsolete
The allure of cloud services to provide the business with flexibility and just-in-time services has rendered the traditional approach to governance in IT obsolete. The cloud has introduced another layer of complexity resulting in new challenges for IT governance professionals.
The most common approach to cloud adoption is the hybrid model, where some services are consumed on-premise and some in the cloud (or possibly multiple clouds). This hybrid approach results in complexity due to the diversified supplier base and resultant segmented technology platforms. The IDC research highlights 79% of organisations are already using two to five cloud services.
I hear you say "what is so hard about that?" - take the governance output from the provider and you're done. Not quite!
Cloud providers deliver governance for the elements they provide. In the case of IaaS providers this relates to storage, memory and compute. The difficulty arises from the number of elements that constitute an IT service. A core enterprise IT service such as an ERP or CRM system is made up of hundreds, if not thousands of elements. These elements will include components hosted in the cloud and on-premise. They are made up of compute, storage, networking, security and identity management elements. Not only are there a large number of elements but we also have to enable the consumption of these services on PCs, laptops, tablets and smartphones. The net result of the above manifests itself in the challenge of providing effective governance in the cloud age.
How do you tackle governance complexity?
So how do you tackle governance complexity in an IT environment where flexibility and ease of consumption is expected? How do you introduce governance into this new world?
The answer lies in the information generated by all of those elements. There is an opportunity for the CIO and CFO to take learnings from the field of Business Intelligence (BI) and apply them to the governance challenge in IT. Data combined with modern analysis tools has revolutionised the speed at which organisations understand buyer behaviour, identify supply chain efficiencies and glean actionable insights from their information.
The same impact can be realised in IT governance delivery by applying the same methodologies, and in some cases the same tools. When looking at the governance problem through the lens of the data analyst, the answer starts with identifying all of the relevant data inputs. Once the data sources have been identified then its simply a matter of recomposing the disparate bits into an IT service view.
The third platform paradigm provides both the challenge and the answer to governance in IT. Organisations and people that can blend expertise in the traditional infrastructure space with an understanding of BI and analytics will overcome the governance challenge. Ultimately cloud consumption and uptake will continue. Successful CFO's and CIO's will need to focus on the governance required to empower their business to succeed with the cloud.
Create a cloud governance capability to exercise authority and control and provide leadership to the cloud, ultimately avoiding your charge into the valley of the death.
The charge of the light brigade (by Alfred Tennyson)
Half a league, half a league,
Half a league onward,
All in the valley of Death
Rode the six hundred.
"Forward, the Light Brigade!"
"Charge for the guns!" he said:
Into the valley of Death
Rode the six hundred.