Change is in the clouds
The emergence of online (cloud) computing and services is bringing change to Corporate IT, and those groups who embrace it will allow their companies to benefit from the rising tide.
GMail vs. Exchange and a memory stick
At a staff event a few years ago I gave the CTO of the company I worked for some tongue-in-cheek ribbing about the services offered internally by our Corporate IT (information technology) group. Our company had recently turned on mailbox size limits in Microsoft Exchange, bombarding me with annoying messages about having to delete mail from my Inbox to get it down to an acceptable size. Since all my email was work and client-related it essentially meant deleting all of the history and content regarding past collaboration. At the same time I'd been using Google's GMail service for my personal email, and enjoying its capabilities and massive storage allowance. Here's my recollection of what I said:
"I wanted to tell you about this company on the Internet that doesn't know me and that has never received money from me, that has no stake in my personal ability to collaborate, that offers me 2GB+ of email storage, lets me access it from anywhere and even lets me search every word in every email in seconds. Meanwhile, there's this other company that I work for, that I have sold and helped to deliver millions of dollars of consulting work for, that depends on my ability to collaborate with staff and clients, that only lets me store 100MB of email before warning me that I'm not in compliance."
I went on to ask that if I donated a 2GB ($20) USB memory stick, could I be allowed to store more email on the server? I backed off a little bit and left out my points about the internal email being hard to access from anywhere but from a local network and hard to search for specific information.
The CTO was very gracious, especially in the face of my implied sarcasm, and conceded that the IT group was trying to balance the use of limited resources across a growing number of users. But he really didn't have a good answer, other than to imply that's just the way it is. Interestingly enough, my personal email storage quota was removed shortly thereafter, sparing me from warnings despite the multi-gigabtyes of data I piled up.
Why the cloud (public Internet) trumps Corporate IT
The lesson for me in this was that the pace of change, the quality of service and the technical capabilities available on the public Internet (i.e. the 'cloud') were going beyond what Corporate IT groups could match. Corporate IT was starting to feel slow, anachronistic and behind the curve. Since then my observation has only been reinforced by several years spent working on projects that interact with Corporate IT groups.
End users are becoming more sophisticated in their personal lives in what they can do online, and how they do it. They can, and do, spend much more of their personal time using the Internet from home and also when mobile. They are becoming used to ubiquitous and timely access to information and online services. Accordingly, their expectations of what information technology should do for them are rising rapidly. Users can go online (or to a local store) and buy a computer that is much faster and more functional (via newer software) than the computer provided to them at work. Unfortunately, Corporate IT is struggling to meet these rising expectations, and is increasingly seen as providing inferior services compared to what users expect in their personal lives. Corporate IT is becoming more of a compliance enforcer (100MB email storage limit!) than a provider of valued services.
The path forward for Corporate IT is to stop fighting against the online tide and to, instead, embrace it. There are two converging trends that will help to shape the future of Corporate IT:
- The rate of change, in terms of technology and services, is much faster on the consumer or public Internet (the cloud) than it is within corporate networks. Technology and services on the public Internet are evolving much more quickly than the rate of change experienced by typical corporate IT users.
- Computing capacity is becoming commoditized and dramatically cheaper over time. Supply is increasing and costs are going down. This is due to the expansion in available network bandwidth (broadband is practically ubiquitous) and the availability of computing capacity hosted in centralized locations, purchased on demand, and shared between users and organizations. The growth of the network (Internet) and centralized data centers (i.e. like those owned by Amazon and Google) makes this possible. The marginal cost for computing capacity has dropped from the price of a new server (thousands of dollars) to pennies per CPU hour online (e.g. 10 cents per CPU hour from Google as of this writing).
A hundred years ago most companies used to generate their own electricity. They had to maintain infrastructure and staff for power generation, regardless of their industry. As central power generation become possible and the power grid expanded companies effectively outsourced their power needs to utilities that could provide a reliable, scalable service and benefit from massive economies of scale.
Looking at today's Corporate IT it begs the question: Why are we generating our own power? Do internal services like email, PC support and file storage provide a competitive advantage or are they candidates to source elsewhere? How much of our time and money is spent making sure the power is on versus creating new value for our business?
Don't generate your own electrical power
So what's a concerned Corporate IT group to do? Some thoughts:
Don't get bogged down on infrastructure. IT infrastructure is not a competitive advantage - it's table stakes for modern business. You have to have it, but don't spend any more time and energy on it than you have to. Outsource to the cloud whatever you practically can. A good metric for this is the ratio of innovation to infrastructure in your IT budget.
Focus on your business. IT needs to get closer to the business, understand how it works and where the challenges are, then use this knowledge to show how technology can be used to improve the bottom line. Raise your business' expectations of what IT can provide, then challenge your IT group to meet that the demand. A pipeline of strategic and tactical technology initiatives providing high business value and competitive advantage needs to come out of this. Execution of the initiatives in the pipeline will provide your metrics for delivery.
Embrace simplicity. The web has developed a culture of 'the simplest thing that works'. Overly elaborate, sophisticated and expensive solutions tend to lose out over time to simple solutions that do one, or a few, things really well. Combining these simple solutions via open interfaces provides the agility to create new value.
Embrace web collaboration. Trends like social networking, decentralized creation of content (and information), and ubiquitous access to searchable information all have value for internal use if properly understood and applied. Stay on top of these trends (by using these services personally) to fully grasp how they can or cannot help your business.
Embrace the cloud. Online services will continue to evolve and improve. Things like hosted applications (i.e. like ERP, sales automation, etc.), hosted email, hosted storage and even hosted application servers all provide high value when used in the right circumstances. Stay informed and take advantage of these services whenever or wherever practical. Seek to become more responsive to the business by using online services. Decreased implementation time for initiatives is a great metric to track.
The emergence of online (cloud) computing and services is bringing change to Corporate IT, and those groups who embrace it will allow their companies to benefit from the rising tide.
