The amount of data in the world is increasing exponentially every second and many data centers are running out of capacity to house this information. Businesses need to decide whether to expand existing data center space, or engage in the costly and labour intensive exercise of building new facilities. Coupled with escalating energy and operational costs, some companies are now spending 70% of their IT budgets on maintenance with little time for innovation. It is against this changing IT background that many enterprises across the world are moving away from tightly integrated, long-term commitments, of client-owned assets, to emerging "Infrastructure-as-a-Service” (IaaS) offerings.

Companies are no longer required to own infrastructure to produce their product. Instead, they can purchase virtual space on a server, allowing for more flexibility in workflows. New IT delivery and infrastructure models, such as cloud computing or converged infrastructures offer increasing competitive advantages, and while some people believe that the cloud could be the death of outsourcing as we know it, it should be seen as an opportunity.

For the first time, businesses will have the ability to use many different delivery methods to acquire IT services, as information technology quickly becomes a profitable service instead of a hired department. As businesses can no longer afford to rely on a one-size-fits-all model to meet core services, today's enterprise will require the best methods of IT service delivery to drive innovation, at a cost that meets solid return on investment metrics, in the timeframe needed. The role of the cloud for IaaS Much of the current attention centres on cloud computing services, which can be defined as a delivery model for technology-enabled services that provides on-demand access to an elastic pool of shared computing assets.

These assets include applications, servers, storage, and networks – all of which can be rapidly provisioned with minimal service provider interaction. The entire pool can be scaled up or down as needed on a pay-per-use basis. In other words, these assets can now be consumed "as a service.” This hybrid, responsive delivery model helps clients build, manage, transform and consume services using the right delivery approach to meet their needs. However, such services are not an immediate cure-all, and there are CIO challenges for an agile business IT infrastructure including:

• Available, experienced personnel.
• Optimised standard architecture, automated processes, and best practices.
• Consistent deployment and measurements of service delivery performance.
• Transformation skills and resources.
• IT interoperability and integration across the enterprise.
• Scalable IT services that respond to changes in business demands.

There is understandable hesitation among large businesses that require enterprise-class IT resources and services about what the cloud can and cannot deliver. However, the market is maturing, and IT providers have assembled portfolios of products and services to help enterprises realise the promise of IaaS.

The degree to which an organisation should move IT activities to a service provider depends on the individual requirements of that business – its core competencies, security requirements, government and industry regulations and business goals. Each organisation's individual needs must be evaluated to determine what shape and form their environment should take, whether that be outsourced, in-sourced, cloud delivered or a hybrid mix.

As it relates to off-shoring, the cloud delivery model is a highly automated service type. As organisations begin to consume pre-built cloud services, they should expect a fall in the manual human effort required to manage the IT compared to traditional methods.  With the cloud, those people who would manage the traditional IT – whether onshore or offshore – are now adding greater value to the business by finding ways to innovate, increase customer satisfaction, and plan for business growth.

Instead of approaching the situation as cloud versus outsourcing, businesses need to focus on a hybrid approach. This will allow them to build, manage, transform and consume IaaS, using the right delivery approach that is specific to their business needs