Through my role as a Global Program Manager & Partnership and Alliances Lead for Cloud Transformation Services at SAP, I am in regular contact with customers who have embarked on a cloud transformation path or are planning to do so. This has an impact not only on the CIO, but on the whole extended IT team. In most cases organizations are moving to a hybrid cloud environment with some applications remaining on premise in a private cloud and in many cases integrating to public cloud offerings.


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This transformation is happening rapidly. Many IT departments feel that they are struggling to stay relevant when the Lines of Business is going off buying their own cloud solutions, without involving their IT department and eroding the IT budget. However, the IT department still carries the responsibility of making it all work together, the new LoB cloud solutions as well as the existing systems. Integration of these systems is a pre-requisite to a functional IT landscape. There are many new skills that the classic IT department, especially the CIO as leader, will have to develop to facilitate this transformation. The IT services need to become easier to consume. The focus is changing from infrastructure to agility.


I believe that the key for success for the IT organization is to transform into an internal service provider, offering IT services to their business (LoB and the end-users). Simply pushing back against the existing adoption of new cloud solutions are not an option, instead they need to become the cloud broker, the one stop shop for IT services, whether they are on premise or in a public cloud. If IT transforms themselves as IT service providers to the Business (LoB and end-users) offered in a private cloud then they will create real value to the business, win back their relevance and with that also their budget.


It becomes less important where an application is running and more important that the services are delivered quickly, with a high availability and flexibility. So IT needs to focus on increasing automation and providing self-service scenarios. And of course the services provided should be charged in a pay-as-you -use principle. In other words, just like a subscription of a public cloud solution. In such a hybrid environment, the internal IT needs to be in control of the integration between the public cloud solutions and the on premise landscape or private cloud ERP solution and can then provide business value to the whole organization and NOT only to the one LoB.

What must the CIO and the IT team do:

Implement the right technology and tools:

  • Standardize the landscape and implement virtualization to be able to scale up and down quickly.
  • Start using automation tools (e.g. with SAP Landscape Virtualization Management Solution) to automate routine administration tasks and management tools from the virtualization vendor for easy handling of the virtualized landscape.

Make operations more efficient by providing IT as a service:

  • Decide on what type of (standardized) services you want to offer and how to charge for them.
  • Define a service catalogue and make it available to the end users, ie on a portal with transparent prizing. The goal is to make the IT services consumerable 
  • Turn IT into a regular business center, not just a cost center

Understand what organizational changes are required

  • Today the different teams within the IT department often work in silos (SAP basis, storage, network etc). All of these teams need to work in multi-discipline, cross-functional teams to be efficient and to allow better cross team communication.
  • Implement the necessary changes to the organization.
  • Define the new roles and skillsets that are needed and re-skill the teams with roles and skills that loose importance.

Career Tips:

  • How is the cloud changing jobs in IT
    • IT professionals need to change from a reactive to proactive way of working. Today there is an expectation on IT to be innovative, understand the goals of the business and support the business priorities.
    • IT should not ‘just’ be taking orders and fixing problems, but be a business partner who provides a service to the organization.
  • Which new job opportunities are being created?
    • Cloud planning & strategy, defining service packages , cloud brokers, service brokers, cloud architects will all be in high demand
    • Security and integration experts, especially those who can navigate between cloud solutions and on premise
    • People that understand the opportunity of cloud and translate to business requirements and new practices
  • Are any jobs at risk?
    • Highly routine jobs
    • Technical administration roles – Tasks that does not add value but keeps the lights on would need to beware of automation
  • Which skills do you need?
    • Skills in the new innovative technologies
    • Interpersonal skills – be able to work WITH the business and not FOR the business
    • Inter-discipline skills to understand business requirements and the technical requirements and be able to bridge them
  • What should the education focus be?
    • Security > Cloud as well as on Premise, Public and Private and the hybrid constellations
    • Integration standards as well as options

Summary

Ideally, the IT staff will see their company’s cloud adoption as an opportunity instead of a threat. With a well-positioned IT department they will move up the value chain and be the strategic partner that creates value to the business.


Surely, some IT roles will disappear, but new more exciting roles will be created that will allow IT to work with new innovative technologies instead of patching servers or back up hard drives.


If the IT staff is willing to change the way they have worked in the past, work closer with the business and to enable themselves in new technologies and solutions, they will stay relevant even after their company’s cloud transformation.

Resources:

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6 Comments

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  1. Faisal Iqbal

    IT being service provider would still be responsible for making sure that business processes run smoothly regardless of what technology is in use; on premise or cloud. So ya, as you pointed out, IT has to take advantage of the technological shift and develop competencies in-house in latest cloud offerings. In this case, if business decides to migrate from certain on-premise solutions to cloud, IT should have capabilities to support the businesses. Thanks for sharing the tips!

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  2. Greg Owens

    Thanks Petra.  I do believe the cloud move is inevitable because fundamentally the CFO within an organisation can know how much he is paying for the soution and can exercise flexibility.  Why is this such a change for an organisation?  Many of the points you mention are topics which an IT department should have executed against years ago and provided that cost transperancy that the CIO / CFO / executive are looking for.  Most of this benefit is in fact no easier to deliver in the cloud – the difference fundamentally is that as a cloud provider you do not have the choice to not do it.  There is no option for a cloud provider to charge you fixed allocations based on the size of server, or the number of support resources, etc.  They simply don’t have the choice.

    This is fundamentally the rationale that cause the comoditisation of many resources and industries.  And is the change large – yes, as large as the move from hierarchial to relational databases, as large as the change from procedural to object-oriented programming and design or …  

    In summary,  this level of change has been constant in IT for the last 30 years – the only question is “can you see it coming?”  or “is it passing you by?”

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  3. Hannes Kuehnemund

    Hi Petra,

    this is a great blog and it inspired me to add additional thoughts to your point about “Start using automation tools” as one of the key things that the CIO and the IT team do in order to implement the right technology and tools.

    The “term” cloud in my perception still introduces a certain level of uncertainty because it is a very fast changing topic – it is by no means not comparable to the stable (sometimes slow moving) on-premise environments where the IT team has full control over the entire stack.

    In order to take the fears away SAP must provide a way to easily experience SAP in the cloud in order to break up those uncertainties. I am confident that SAP Cloud Appliance Library (CAL) can help here because it allows SAP customers who come from the traditional on-premise world to experience the cloud with no or little efforts. One can try SAP in the cloud via self-service to make up their own mind.

    Again, great blog and can’t see to read more from you.

    Hannes

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