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4 Steps to Making IT Strategic in the Cloud Era

 

4steps10222015In a world where technology platforms and business applications are being delivered through the cloud as a service, instead of via company owned on-premise deployments, does the acronym CIO today stand for ‘Career Is Over’ instead of Chief Information Officer? 

 

The answer is no; nothing could be further from the truth. The cloud offers CIOs an unprecedented opportunity to play a much more strategic role in the organization. The need of the hour is a visionary Chief Information Orchestrator that can bring harmony and melody to the partnership between cloud providers and the internal IT organization, transforming IT from cost center to revenue generator. There are four steps toward becoming that CIO of the future.

 

1. Partner

Application providers, technology vendors and IT Leaders all agree that the cloud deployment model is here to stay. Business leaders, who are the CIO’s internal clients, demand applications that will solve their business problems. They want the agility and flexibility the cloud brings, and often times they’ll go out and find cloud solutions and bring them to IT.  

 

This is actually good for the IT organization. Rather than having to spend their days supporting and maintaining infrastructure and applications, they have an opportunity to work with cloud partners that will offer them best of breed applications along with best in class service—better service than they might be able to provide with their own resources. Now IT can cut the time and effort spent on valueless tasks and instead partner with vendors to offer valuable solutions to business problems. That’s the first step.

 

2. Orchestrate

But partnering alone is not enough for the IT organization to become strategic. While the cloud has taken many tasks off enterprise IT’s plate, it has also introduced new, higher order problems that no one cloud vendor can solve.

 

Cloud applications may provide the best solution for a particular business problem. There are cloud providers for Enterprise Resource Planning (ERP) Customer Relationship Management (CRM), Human Resources Management, Spend Management, and other line of business applications. However, businesses must support many different business processes, and no cloud vendor that covers every business process in their application. There is a big need to bring the business processes and data across from all these applications together to provide meaningful insights to the end user. The only team that can solve this problem is the IT organization within the enterprise.

 

For example, biotech and pharmaceutical companies have to comply with strict regulations such as the Sunshine Act, a 2010 United States healthcare law aimed at increasing the transparency of financial relationships between health care providers and pharmaceutical manufacturers. Many of these companies have implemented Software-as-a-Service (SaaS) solutions to capture data about how their sales organization interacts with doctors as they promote the company’s products.  The Sunshine Act mandates that when a company does this kind of marketing, it keeps detailed records of what they spend and where. 

 

What some of the more mature IT organizations in these companies have done is build seamless integration of this data from the SaaS solution to the compliance systems that they have on premise, ensuring that internal and external auditors have the right view into the relevant information at the right time. By proactively looking into spend patterns, they’ve been able to improve guidelines for the sales force in the field, and avoid costly charges for non-compliance.

 

Every industry and every company has situations like this that require orchestration of a business process across one or more systems. 

 

Who better than IT to play that role? They have the visibility into business processes across the enterprise. They understand the various cloud and on-premise applications that the business units are using, and they have the tools for connectivity and transformation of data.

 

3. Create visibility and deliver insight

The third step is for the CIO to show strategic leadership, supporting a vision of enterprise IT bringing these cloud islands together and provide a level of insight and visibility to the business that they never have had before and cannot get from any one cloud vendor. These data insight initiatives should be anchored in quantifiable success metrics that will allow the CIO to showcase the value they are bringing to the business.

 

4. Generate revenue from data

The final step is to become a revenue generator.  IT has always been seen as a cost center. Businesses across the world operate based on one simple equation: Profit = Revenue – Cost. Most IT initiatives impact this equation by reducing cost. There will always be room for strategic initiatives managing spend and reducing costs.  However, with partnerships with cloud vendors and the data integration platform in place,, the next generation CIO can go one step further and become a revenue generator. 

 

Data is the most valuable asset that an organization has. When IT plays the role of bringing data from different cloud applications together, not only do they provide insight to the business, they now have the data and the tools required to analyze and mine it at their fingertips. Using these tools to ask questions and discover patterns can lead to insights that can help enterprise cross sell to new customers, launch new product or services, or get into new business models all together, all of which can become new sources of revenue for the company. 

 

As a leader of integration, platform and strategy at a SaaS company, I will be the first one to say that every cloud vendor needs to work with a strong and vibrant internal IT organization to be successful. But the leadership opportunity extends beyond being a good partner to these cloud companies that have taken the more mundane IT tasks off IT’s hands. There’s a real opportunity to let them do the grunt work so you can contribute more value to the organization. For CIOs that play their cards right, their career as they knew it might be over, but a more exciting one is beginning.