7 Things Your CEO Should Know About the Cloud

Jason Cowie is vice president of product management who oversees product direction and strategy for Embotics, which specializes in private cloud management.

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The IT community has identified, discussed and brooded over the challenges of reaching the cloud. We’ve examined and addressed the causes of virtual sprawl and stall, we’ve figured out the importance of automation in private cloud deployment, and we’ve come to an understanding about the value of bringing cloud computing into the enterprise, where end users can gain some autonomy for provisioning and self-service management. The biggest hurdle left to clear will become the most pressing in 2012. IT is still struggling to communicate cloud realities to business leaders. Until the CIO and the CEO see eye to eye on the path to the private cloud, too many companies will fail to reach that goal.

IT must overcome that communication challenge in 2012. Doing so will require some frank conversations with the executives in corner offices. In 2012, there are seven truths CIOs must be ready to tell their bosses when it comes to cloud objectives. These include:

Creating the cloud requires more than a technology buy

Back when we were talking about the need to invest in virtualization, CIOs went to their bosses to pitch the business benefits. Beyond a technology conversation, they talked about increased flexibility, agility and cost savings. By telling a story that applied to the whole business and not just to the data center, CIOs were able to get the capital investments they needed to virtualize.

A similar pitch is required for the move to the cloud. The CIO has to sell the CEO or chief financial officer not just on an infrastructure investment, but on a strategic initiative that drives down costs, improves customer service and provides a competitive advantage.

This first truth is about a requirement for people, processes and technology in order to reach the private cloud. Process re-engineering, aligning business goals with IT objectives, and ensuring the right people are in place are requirements. In 2012, more companies will demonstrate their understanding of this fact, as they embrace a pragmatic path toward a true private cloud. As IT and business leaders come together to see the same cloud vision, there will be fewer fears from the corner office that cloud requests from the data center will mean ripping and replacing recent investments.

The expected return on investment is backed up by research and industry experience

CIOs should seek out the advice of cloud analysts, media and vendors, and pull out the data that supports pure IT business agility. By making the business paybacks clear with supported, unbiased, third-party support, CIOs are more likely to win over their business counterparts.

IT has carefully considered the specific needs and resources of the organization

CIOs should evaluate and analyze their virtualized data centers, processes and people before they approach CEOs about cloud deployments. The key is to understand where organizations are today and where they hope to be tomorrow. If process improvement, agility and operational efficiency are important, the cloud most likely has a valuable role to play.

With that in mind, CIOs must examine what they will need to best operationalize the cloud for their specific organizational needs. Then, they should use that information in the first discussions about cloud investment with CEOs and CFOs.

We can deploy pilot tests before extending the cloud company-wide

The conversation with the CEO might be more successful in some organizations when the CIO pinpoints a specific department or workload (such as development, quality assurance or testing) in which to test out cloud processes. This approach can also help CIOs combat any counter arguments about scope creep that might be raised by the CEO or other business-focused executives.

The cloud is not an amorphous thing, and IT can detail the exact needs and investments required

CIOs should not assume that the executives who hold the purse strings fully understand the term “cloud.” IT leaders must get specific about what a private cloud is and what it should include. Conversations with business teams should cover all the components involved in a cloud deployment, such as self service management and provisioning, service catalogs, cost show-back, IT charge-back and others.

The latter might be of particular interest to CEOs and CFOs and should be explained fully. This includes discussing the benefits of showback and costing models. Private cloud deployments should not only enable companies to implement show-back and charge-back, but also help them monitor and curb consumption for IT resources. This leads to more accountability over infrastructure investments (both capital and operational expenses) and ultimately a lower total cost of ownership (TCO).

There will be short-term benefits, but moving to the cloud is a long-term strategy

CIOs should be mindful of executive interest in speedy returns. For this reason, IT leaders should approach their meetings with CEOs and CFOs armed with solutions that deliver critical private cloud computing competencies quickly and effectively in order to deliver real-time infrastructure as a service to customers.

However, it’s also important to be straightforward about deployment schedules and return on investment time frames and realistic about long-term needs for automation and management. In 2012, cloud conversations should include the reasons why self-service management, increased quality of service delivery, resource optimization, and improved operational efficiency matter to successful cloud implementations.

Moving to a cloud environment is not “an IT thing.”

The CIO might be charged with starting and shaping this conversation, but it should be clear that private cloud initiatives can become strategic business enablers by providing a competitive edge in the time, speed and cost required to deliver infrastructure on demand. CIOs should be prepared to measure and quantify savings. Part of that will mean defining service level agreements and project goals that are quantifiable and realistic.

Increasingly, there is a common understanding about what a private cloud is and what it can mean for business. However, in organizations where that understanding is still weak or non-existent, CIOs need to take charge of educating their colleagues and superiors.

In 2012, IT administrators need to have frank discussions with executives on the business side of the enterprise. If they are to reap the benefits of operationalized private clouds, CEOs need to hear supported, concrete and business-focused truths from their CIOs.

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