Here’s the scenario: some people in your company decide they want a new business application, and the clock starts ticking. The CIO and the IT group are under pressure to get it done fast—because if they don’t, the line-of-business users could circumvent IT completely to get what they want.
If this is happening at your company, it’s likely because IT and the business are increasingly moving at different speeds.
“The whole shift toward technologies such as the cloudlies in a fundamental disparity between how quickly businesses change and how quickly IT responds,” says Rod Johnson, group vice president, Oracle Applications and Industry Solutions. “We have found that the gap between business change and IT response has been growing, to the point where there’s now about an 18-month lag time between when a business unit needs something and when IT can respond.”
Although CIOs must respond, they must also make sure that their IT expertise is part of the conversation. Here are three tips to help the cloud-minded technologist influence the adoption of new solutions.
Tip 1: Be a Cloud Ambassador
Although cloud technology undoubtedly shrinks the gap between business change and IT response, CIOs cannot implement it in a vacuum. They must consider how to optimize their existing investments in current systems, figure out how to integrate cloud and on-premises systems, and find the expertise to help with the transition. Otherwise the up-front savings from the cloud will be erased by having to glue and reglue data, analytics, and business processes together.
This still leaves the CIO counseling patience to internal clients—who often want things right now. If IT can’t respond quickly enough, clients will typically look to the cloud to get what they want. As a result, so-called shadow IT spending accounts for more than 30 percent of total IT spending, according toCIO magazine’s 13th annual “State of the CIO” survey of 722 top IT executives.
So CIOs must be cloud ambassadors, managing relationships between third-party vendors of software as a service (SaaS) and existing on-premises solutions—and exercising diplomacy between IT and lines of business.
Tip 2: Watch That Rogue Spending
“First-generation cloud spending caused significant growth of overall IT spending for companies, and most of it is hidden in expense budgets across the company,” says Johnson. “It will certainly be eye-opening when the CEO thinks the company is spending 3 percent on IT and finds out it’s spending 4 or 5 percent instead.”
Ironically, shadow IT cloud spending only exacerbates the cloud migration challenges that currently depress IT response rates. “Companies want to be able to migrate in a practical path, and rogue IT cloud projects often do not take integration issues into consideration, instead utilizing a ‘rip or replace’ mentality that makes it difficult to onboard new innovation while still being able to scale and integrate applications,” says Johnson.
Tip 3: Turn Current Spending into Future Investment
In response, companies must find ways to modernize by shifting more of their tech spending from maintaining old systems to investing in new capabilities, a top technology trend this year.
The key, says Johnson, is to find ways to modernize within the system itself, and technology partners have an obligation to evolve the customer experience to further this goal. For example, Oracle has developed a program called Customer 2 Cloud to help customers shift their investment ratio within certain Oracle application families by redirecting elements of their installed on-premises solutions to Oracle application cloud services within the same family. The program is open to all existing Oracle customers of CRM and HCM solutions in Oracle E-Business Suite and Oracle’s Siebel, PeopleSoft, and JD Edwards product lines to help them adopt the innovative capabilities within Oracle Customer Experience
Cloud and Oracle Human Capital Management Cloud.