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The top of your game

01 Mar 2011

Following the global financial crisis, businesses have reduced the bottom line as much as they can. They now need to look at ways of growing top line revenue by breaking into adjacent markets and exploring other areas of their businesses value chain. The changing role of the CIO The rapid uptake of technologies such as cloud computing will see the role of the CIO change from one of being an expert in the technologies they manage on a day-to-day basis to becoming a manager of relationships. The modern day CIO will need a different skillset – one that is more business oriented and will see IT making a significant contribution to meeting business goals, rather than focusing purely on delivering the technology. The challenge for the IT manager will be how these applications are secured, managed and integrated back into the business to enable effective collaboration. The flip side of this is that the shift away from employing technology experts to perform the role of the CIO may lead to missed opportunities through ignorance of the latest trends and developments in the technology industry. CIOs will be relying on their outsourcing partners to be their experts and will need to ensure that contracts are detailed and specific in terms of due diligence, security, access and identification. Organisations could, at worst, leave themselves at risk of breaches and become uncompetitive as they lag behind in technology. Virtualisation and cloud computing – what’s next? Organisations can expect increasing structure in the management and adoption of virtualisation technologies. IT managers will face a real challenge in learning to manage multiple virtualisation technologies including sever, desktop and application. We will also start to see a blurring between virtualisation and the cloud, with public and private clouds, as both technologies continue to evolve, leading to more choice and greater access. There will also be a shift in the way businesses think about cloud computing as we move away from justifying a return on investment (ROI), which has been proven, to new challenges involved in implementation and management including security. We have already witnessed some success with Google and Microsoft in terms of hosted email, but in 2011 it will be all about moving applications to a hosted environment. CIOs will also need to be able to build business cases that demonstrate what benefits cloud computing can offer to the business beyond ROI. Part of this process will involve identifying which applications to move to the cloud. CIOs need to consider contained applications that are not vertically integrated with other line-of-business applications as the ones to migrate first. Once that has been demonstrated the actual process of migrating can be relatively seamless. The problem lies in the fact that because uptake is relatively new, most businesses are only half way through the process, as such it is difficult to show whether the business case has been met. It will be another year or so before success in these terms is really able to be measured and quantified. What can the cloud really do for my business? Although virtualisation has given businesses some cost efficiencies, it hasn’t delivered the cost savings businesses first expected. With the reducing cost of disk space and server infrastructure, businesses have taken on extra servers leading to virtualisation sprawl, where the number of virtual machines on a network reaches a point where the CIO can no longer manage them effectively. What virtualisation did deliver, however, was the ability for businesses to be more nimble. We will see a shift away from "It’s going to save the business money”, to "It will give the business the ability to expand into new markets and provide greater flexibility”, completely changing the game. CIOs and businesses really need to consider how they can use this to their advantage. Making any further reductions to the bottom line would only be foolish, leading to a loss of valuable employees and resources, which means looking for opportunities to grow the top line by leveraging cloud computing. Take the explosion of online shopping as an example. It is essentially the cloud version of the shopping centre expanding into new markets and leveraging technology to grow. It enables retailers to:

  • Reach more people more quickly.
  • React to competitors pricing schedules rapidly.
  • Try new things.
  • Respond instantly.
  • Roll out new offers.
Most retailers now first test ideas on the internet and then roll them out to traditional media once successful. In the same way, businesses can use the cloud based environment as a test case for other core capabilities before rolling them out across the entire organisation. CIOs are increasingly becoming key players in helping organisations meet business objectives, drive revenue and increase competitive advantage. They need to stay on top of the game by leveraging technologies such as cloud computing in order to do this.