Cloud decisions are no longer in the IT department's hands - the suits have taken over

Cloud decisions are no longer in the IT department's hands - the suits have taken over

Summary: A new report has revealed that decisions around cloud are increasingly being made by people outside IT departments.

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TOPICS: Cloud, EU, United Kingdom
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The cloud has well and truly slipped the bonds of the IT department, a new report has found.

The report, commissioned by IT consultants Capgemini and released on Thursday, surveyed 460 organisations globally and 50 in the UK, and shows that the responsibility for cloud adoption lies primarily with employees without an IT background.

"The real cloud evangelists these days seem to be on the business side and not the IT side," Ron Tolido, senior vice president for Continental Europe at Capgemini, told ZDNet. "Until now cloud was often considered a more technology-driven topic."

In the UK, business units make decisions on cloud 45 percent of the time, in comparison to IT with 44 percent and third parties with 11 percent.

"Almost half of all decisions around cloud in terms of budget, selection and implementation are made from the business side," said Tolido. "It means that from the IT side more and more people have to deal with people like chief marketing officers, boards, executives, people responsible for HRM [human resource management], procurement, or finance and administration. That's quite a shift."

Cloud uptake

In the relatively mature UK market, 83 percent of companies have decided on a strategy for adopting cloud compared with 76 percent of organisations globally. "The uptake of cloud is highest in the US and Europe is lagging behind, certainly in countries like the Netherlands and France," said Tolido.

In total, 89 percent of UK firms agree that the economic climate is driving the move to the cloud, citing moving into emerging markets and territories (53 percent) and deploying new applications (23 percent) as the two industry events or triggers that encourage organisations to reach for the cloud.

"From the IT side more and more people have to deal with people like chief marketing officers, boards, executives, people responsible for HRM..." — Ron Tolido, Capgemini

The UK favours the use of private cloud, with 45 percent of all companies sampled, whether cloud users or not, saying private cloud off-premise, hosted by a partner was their preferred cloud use model. A further 22 percent said they'd prefer on-premise private cloud. "We thought there would be more support for public cloud scenarios," Tolido added. 

Software-as-a-service is the most commonly used type of cloud service in the UK with 42 percent of companies surveyed by Capgemini saying they used it. Meanwhile, infrastructure-as-a-service was used by 40 percent and platform-as-a-service was used by 36 percent. 

According to Tolido, businesses are using the cloud for functional applications such as customer relationship management (CRM), collaborative procurement, finance and administration and human capital management.

The UK summary says the main factors holding businesses back from adopting the cloud include: "lack of integration" (cited by 45 percent of firms); "lack of agility in the business" (35 percent); "fear of security breaches" (33 percent); and "lack of clear cloud strategy" (31 percent).

Of the UK firms who haven't yet developed a cloud strategy, 83 percent say it is not seen as a priority at present.

Topics: Cloud, EU, United Kingdom

Sam Shead

About Sam Shead

Sam is generally at his happiest with a new piece of technology in his hands or nailing down an exclusive story. In the past he's written for The Engineer and the Daily Mail. These days, Sam is particularly interested in emerging technology, datacentres, cloud, storage and web start-ups.

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26 comments
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  • Good!

    Then they can handle all the support too just like their BYOD devices that they bring in all broken and infected that they expected fixed for free because "they use it for work"
    bobiroc
    • Of course, in the real world, that will never happen.

      The suits have always made stupid decisions that the IT department is thence made responsible to fix and support, no matter how idiotic or inappropriate that decision may have been. They will never, ever, in a million years admit they were wrong or made a mistake. I have seen this happen time and time again over the last 40 years, and punishment for the culprits is rare, unless the cost to the business is so extreme that it cannot be covered up anymore. Crucifixion of the IT management who were forced into going along with the idiocy is more often than not the usual outcome, and then the moron who made the decision is promoted somewhere else, where they will inflict their stupidity on yet another department.
      thetwonkey
      • This has been my experience, but then I get laid off!

        Front line IT workers who know these projects are doomed are not heeded, then they are the ones who get laid off when cuts come.
        Robert_Red
    • BYOD

      Get with the program. IT exists to support business functions. Look back at the transition of IT during the entire history of computing and you will see significant shifts to end-user control, self-service capabilities, and on-demand applications. This is not a bad thing. The roadblock to broader success with this trend, is the population of IT die-hards who want to keep everything as it always was.
      New Channel Media
      • I know of one company that has already LOST a fifty million dollar

        contract because they allowed BYOD and thus breached the system security in such a way that is was deemed as not fixable in the short term and thus in violation of the security terms of the contract. Zap, a year in and an eight year fifty million dollar research contract went out the window because the suits at HQ just HAD to have their own smart phones connected to the corporate network.

        We can be sure to see some of the same issues arising with the suits insisting on deciding about the cloud services. We'll also see a rise in malware attacks hitting home, and major increases in maintenance costs as it becomes more lucrative to attack the mobile devices and the suits bring them in to be fixed by people not trained on them.
        Deadly Ernest
  • Maybe "the suits" are right

    "The suits" (aka, the people who bring the money in) have been bypassing internal IT ever since Cloud applications first became commercially viable. To start with, this was driven by failure of internal IT to deliver what the business wanted (or perhaps more kindly, to deliver it in the time scales that the end users were demanding because IT was flat out fixing legacy applications). Paying by credit card conveniently bypassed all the financial controls about IT spend and capex.

    However, CIOs ARE now being involved in Cloud decisions, as the applications become more critical to the business. But true, they are often brought in at the end after "the suits" have worked out what they want.

    Maybe "the suits" know what they want, rather than how to get it. It is their business, after all!

    John Paterson
    http://www.reallysimplesystems.com
    JohnPaterson
  • Fooling the suits

    "The real cloud evangelists these days seem to be on the business side and not the IT side..."

    Could it be because the suits are easier to B.S. and be sold a bill of goods than someone who understands the problems with the cloud? Non-tech people love to jump on the latest fad because they want to appear up to date. Lot's of iPads are sit unused because the suits who bought them do so to be "up to date" and "cool."

    Anyone who isn't going with the latest fad is behind the times and to be shunned. It never ceases to amaze me how businessmen can hire well-trained, knowledgeable IT personnel and then ignore their advice.

    Have a nice, cloud-free day,

    Doc
    Doc.Savage
  • Business workflow (Suits) create the need for IT solutions

    Cloud based and SaaS are a practical solution that evolved because it is necessary to have everyone on the same page to succeed in business. In my opinion, the issue resides in the following way. “Suits” ask for “Secret Sauce Solutions” (SSS) and the IT departments have the pumps to deliver it. However, quite often, IT does not actually have mastery over the recipe for SSS, only massive pumps. As the technology platforms became homogenized and cost effective, it became easy for others, outside IT, to pump the same volumes, often more effectively and securely. Some firms can simply do both, understand the chemistry of SSS, and deliver it. They specialize, where IT simply distributes.
    For example, the company I work for, DR McNatty, has been involved in these solutions for decades, not because we are tech geniuses (which we are) but because the market has spoken, created a need for specialists in the Project Management and Scheduling universe, and most often, using Oracle products like Primavera., and the secure global data sharing services we provide.
    For example, there are few businesses that require more integrated solutions than those with large Capital Projects (Think: Utility Companies), and those Project Managers and Schedulers manage mountains of important, integrated, real time / real need information where the price of an error is extreme. Also, there is a lot of project high level reporting required…In short, that is why they all run Oracle Primavera. That is a very complex piece of software that requires companies like ours to customize it to client needs, implement adoption / roll-out, host it on a very secure Hosting / Server model (each client gets their own server) and then we train users how to get the best out of it.
    So, this article is spot on. Distributed sharing is fundamental. In my experience in this world, I tend to focus on conversations with Project Managers and Schedulers. It is like a visit to the doctor. “Where does it hurt?” “Right here” … “Ok, here is a prescription” In that analogy, the “Suits” are the people with the pain; the “prescription” is integrated solutions that involve IT. Not really the other way around…
    RCPBKK2555
    • PS: Business workflow (Suits) create the need for IT solutions

      I enjoyed a chance to talk about this…if you are in the business, or need help, I always invite extended conversations with me at rpfifferling@drmcnatty.com. I rarely comment on postings, but this one is about what we do, and have done for some of the largest companies in the world, so it is always nice to learn from others what current problems / solutions are.
      RCPBKK2555
  • What is OPS?

    Oracle Primavera Solutions is an enterprise project management company. This "feedback" is nothing but spam -- advertisement disguised as commentary.
    Doc.Savage
    • V003 Business workflow (Suits) create the need for IT solutions

      Hello Doc Savage,

      First, please let me thank you for pointing out I had chosen the actual name of a company as my ZDNet user name. As I said, I rarely post on the internet, and in fact, this was my first posting to ZDNet. I have changed it to RCPBKK2555.

      Please let me first address you last posting, and then talk about your original post.

      (1) "This "feedback" is nothing but spam -- advertisement disguised as commentary."

      (1A) It is sort of funny you call it spam, with your IT background, since as you know, spam involves unsolicited bulk messaging. I do not consider two postings "bulk" and since we elect to engage in forums by choice, it is also not unsolicited information.

      (1B) I will not apologize for being subject matter savvy, and offering evidence of that by letting readers know who I work for. However, I will agree that the second follow up could generate a one on one conversation with a business process professionals who prefer to discuss company sensitive issues, and yes, perhaps move the process forward to become a client. If that was my only goal, I certainly would have toned down my personal perceptions of the hurdles many IT departments generate in a team environment where the true goal should be to target and employ the solution that is best for the company, not just one department within it. Please review my posting, and I do hope you agree every effort is made to "keep it real" and pablum free.

      (3) "The real cloud evangelists these days seem to be on the business side and not the IT side..."

      (3A) Let's talk about the elephant in the room, shall we? Distributed solutions outside the IT department often reduce staffing requirements, and minimize the power and influence of the "key masters" who sometimes seem to enjoy the feeling of "I can not be replaced." There, I said it.

      Could it be because the suits are easier to B.S. and be sold a bill of goods than someone who understands the problems with the cloud?

      I actually agree with you that a "naked cloud" is a scenerio of not "if" there is going to be a problem, but "when" if not properly managed. There are companies who host enerprise solutions on singular servers, where the only software and data is specific to one client. Primavera is a sterling example where, in a scenario where four companies operate on one server, and a patch is applied to one, it can ripple across the other three and create problems. So, single server hosting is much more bullet proof, easier to secure, and replication in a dedicated stream is reliable. I do some times have to scratch my head when I think that a $X Billion Project is being hosted in a third party server farm, and that data resides along side others.

      (4) Non-tech people love to jump on the latest fad because they want to appear up to date. Lot's of iPads are sit unused because the suits who bought them do so to be "up to date" and "cool."

      (4A) I hope you agree, Oracle's Primavera suite is not a fad, not especially "cool" ... but yes, if properly configured, truly up to date (and effective)

      (5) Anyone who isn't going with the latest fad is behind the times and to be shunned. It never ceases to amaze me how businessmen can hire well-trained, knowledgeable IT personnel and then ignore their advice.

      (5A) And here is the rub sir. A company is a collection of specialists who work in a collaborate symbiotic way to drive revenue and grow. These "suits" with advanced degrees, and decades of experience may not be able to plug in an RJ45, but they excel in areas neither you nor I could begin to tackle. They are, like it our not, the drivers who create the "high class problem" of needing an IT department. Not the other way around.

      So, yes, this is daily part of my conversation with them, to try to strike a balance where each tool is maximized to its highest potential to do what it is designed to do, add value to the process, and in so doing, dollars to the bottom line.

      Happily, 99% of the time, it is a cooperative partnership with IT, not a combative one, where everyone wins, and relationships are enhances, not compromised. In fact, a fair share of my practice is getting IT leaders and teams trained, so they can control and maintain these products, well within their company, and without any other outside help. They actually become ... more ... valuable, not less.

      (6) I am not sure how the ZDNet content is available for you and I to interface in real time, but I am guessing if this were a "Cloud free day" it might not be happening.

      Best Regards....
      RCPBKK2555
  • Whoever signs the check...

    ...has the control. This appears to be a large part of outsourcing's appeal to managers. It's illusory, though, as the effect is to put an extra layer of bureaucracy between management and the people who actually do the work, those doing the work have no reason whatever to be loyal to the organization, and an entrenched contractor can be even harder to fire than an individual regular employee (one thing to fire a single employee; quite another to fire your whole outsourced IT shop).
    John L. Ries
  • (Agreed, in part) Whoever signs the check...

    "...has the control. This appears to be a large part of outsourcing's appeal to managers. It's illusory...."

    I agree, that the person writing the check has control. Where I do not agree is that control is an "illusion." From the moment they decide whether to start the day with coffee or tea, and end it with "what is the best possible solution to my business needs."

    "...though, as the effect is to put an extra layer of bureaucracy between management and the people who actually do the work...."

    Actually, no really. Often, in practice, it eliminates layers, since stakeholders have laser focus, direct communication, meaningful bench-marking tools, and most importantly, accountability with consequences.

    "...those doing the work have no reason whatever to be loyal to the organization...."

    If by that you mean consultants working for other companies, I might suggest that they are intensely focused, and have every possible motivation to meet and exceed "check writer's" directive. For them, there is "no Plan B", no "I will go work on another project." It is do, or die, every day and ...

    "...and an entrenched contractor can be even harder to fire than an individual regular employee..."

    ... consultants can be fired over the phone. There is no HR hassle, no potential for lawsuit, no hearing at the unemployment office ... no hassle for the "check writer" ... just .. you have failed to meet my expectations ... "Goodbye." Specialist consultants can simply lose their job anytime, any day...they know it, it drivers pro-active behavior...and is why they often outperform internal teams. I have been on both sides of the ball, consultant ... and check writer ... it is a "results matter" driven relationship that generates meaningful results where accountability is transparent and required.

    "....(one thing to fire a single employee; quite another to fire your whole outsourced IT shop)...."

    This premise suggests one employee can do the work of of an entire IT shop .. be it internal, or external. However, if there is a single team member issue, to replace one internal player is a nightmare, while...again, a check writer can simply call his outsourced team lead, say, "I do not like working with "A", and later in that same day "A" = "B" It is about results.

    So, in short ... no. Outsourcing does not create additional bureaucratic layers, it reduces them, and often to a one on one relationship. It creates solutions that can be scaled to size in real time, and experts can be brought in on one phone call. It is the difference between renting a U Haul, and buying a truck for a one day move.

    Outsourcing is a delight for decision makers.

    Stakeholders follow the path of least resistance to achieve identical results... Outsourced task specific teams are that path.
    RCPBKK2555
  • "Lagging behind"...

    Actually the reason why Europe is lagging behind might be the fact that in Europe privacy is rather a big issue. Companies or government do not have 'easy' access to cloud data as it seems possible in the US.

    When migrating to Cloud solutions part of the servers and/or data might be placed in the US, which makes them part of US law. Therefore companies hesitate to implement cloud solutions which are offered by Global firms like Google, Dropbox, et cetera.
    Peter Hoogstraaten
  • Suits or the Legal Suits?

    What I see happening is that the 33% who are concerned with security will jump a lot higher. That is the legal counsel people will have a say since many companies have to deal with compliance. This includes, in the U.S., HIPPA, HITECH, CJIS and FACT Act. As privacy issues get more and more of the spotlight and legal violations start costing more and more (we were told HIPAA violations, regardless of a breach, could cost 1.5 million USD each in fines). At least things are covered in the private cloud or if non-vendor encryption is used (public storage sites claim no HIPAA responsibility and claim that no sites are CJIS compliant).

    The other issue will be European privacy laws. So, IMHO, I think that security issues are going to soar once someone figures out that security is going to be the number one issue.
    hforman@...
    • (Reply) Suits or Legal Suits

      Hforman and Peter,

      I just learned something very valuable from you both, thank you. I honestly never thought of that.

      My company hosts from an environment where each client has their own server as a stand alone. We do not even allow another company to reside in that environment.

      My question is, in that scenario, are our customers better served and protected from these very valid concerns you have made me aware of?

      Thank you for your input and feedback... Much appreciated...

      Richard
      D. R. McNatty & Associates, Inc.
      RCPBKK2555
  • better safe than sorry

    Maybe there is a good reason why IT specialists are cautious about the cloud theme. IT security is still a neglected topic. In the eyes of many "suits" security is just expensive and sometimes even hindering. The cloud creates even more open doors and weakens the overall network security in a company.
    EnticingHavoc
  • Nothing New Here

    I am surprised that anyone is surprised. After 30 yrs of development, it has always been this way. The normal dynamic is that some new IT person proposes a new buzz-word to their manager. Non-techie manager fears that they will become dinosaurs so they jump on the buzz-word and toss it around like they created it. Management buys it. Sometimes it is a good product, sometimes not. For the most part, what MBAs do not understand is that very little has changed in out industry in 15 years. The technology we use today, exisited 15-20 yrs ago. A good example is Apple TV which launched nearly 20 yrs ago but they will relaunch it as NEW in Nov. 2013. Platforms change, hardware changes but the underlying tachnology is still the same.
    runawaybrain
    • Reply - Nothing New Here

      I think that there is a tail wags dog story here. In my experience, business needs drive decisions about tools. Business managers are saying "I want my team, regardless of geography to have the same functionality they have at corporate headquarters. I do not want to hear, "the server is down, Frank is on vacation...etc. They therefore buy into the "Cloud" concept, where they are promised a utopia, and miss one point. It is not a secure environment, and rarely matches the powerful firewalls that internal IT team build and maintain, much to their credit. There are other solution however, that offer the functionality of the cloud, with the same protection as Internal IT, at a lower cost, with more flexibility.

      I keep seeing words like "fad" which I equate with the latest coolest smart phone...not Fortune 1,000 enterprise level decision making involving teams, up to and including the CEO, CIO, COO...etc. pretty informed decision makers, I would say...
      RCPBKK2555
  • A changing dynamic between suits and IT

    I confess I have an interest in this working for a SaaS single sign on company. That said I see a very real change where the Line of Business Manager can chose the product that best suits their needs without having to worry about a skill set or hardware platform existing in a company.

    This is liberating - however Business MUST include IT in the decision making process and on going management as only IT have the skills and processes to enforce the provisioning and deprovisioning of users, have understanding of the requirements of certain compliancy regimes and have the ability to put the controls in place to ensure that control of users access and data is not lost completely.
    510808