It shouldn’t be a surprise that CIOs and business managers have a different take on cloud computing. Research conducted by Dimensional Research, for example, found that the overwhelming majority of business managers (80% of survey respondents) focused on the business value. CIOs focused on how the cloud enabled them to address issues like compliance requirements (58%) and competitive advantage (51%)
Compared to CIOs, business managers were more than five times more likely to chose business value over any other factor including compliance (14%) or competitive advantage (13%). And in what could be interpreted as a bad sign for IT, the most frequent “other” reason given by business executives for choosing the cloud was that IT did not need to be involved in the purchase.
The survey, sponsored by HostAnalytics, can be found here. Where business managers focused on the business value enabled by the cloud, the CIO was also interested in how the cloud helped the business solve tricky problems, such as an aging and increasingly obsolete software portfolio. For example:
- 61% of survey respondents say that critical applications have not been updated recently
- 14% report that they have business-critical software that has not been updated in over four years
- 28% of CIOs responsible for that business-critical software say they lack confidence in being compliant
Apparently business managers do not see the quality of business-critical software as an important issue. But why should they since IT already is worrying about it.
The cloud, through SaaS, is an ideal way to quickly update business critical software and ensure it remains up to date without business disruption. The cloud has matured to the point where a CIO can find almost any type and category of business software.
A directory, The Cloud Showplace, boasts over 2000 companies listing products across 90 software categories. In this case the cloud is changing the way organizations acquire and utilize business applications and other computing resources. It also is changing the go-to-market strategies of hardware and software vendors and how they develop, deliver, package, price, sell, and support their products.
The survey also touched on the issue of customizing software. Software customization has long been regarded as a dangerous pitfall when organizations were licensing enterprise on-premise ERP and CRM systems only to initiate lengthy customization projects. With SaaS, however, that seems less of an issue.
The researchers, however, looked at the potential difficulty finding available expertise for customizing SaaS applications. This apparently is not a problem reported by the survey respondents. The majority of CIOs (83%) reported that they can easily find employees or contractors to manage and customize their cloud applications.
Customization in this case is vastly different than what organizations meant when they customized on-premise licensed packaged apps. Then, they might have actually been changing the underlying code base. With SaaS, customization really means configuring the app, and the SaaS vendors build in numerous points where users can configure the app to their taste with point-and-click ease. The underlying code is never changed. The same goes when the code is updated; the vendor updates the code while the users’ customizations are preserved.
It is this promise of transparently up dated business-critical apps that makes the cloud, in part, so appealing. Over half (61%) of respondents reported they have business-critical software that has not been upgraded recently. As that software falls further behind, the cost, risk, and disruption of upgrades becomes much greater. For some (14%) the problem can only be classified as severe; their organizations rely on software that has not been upgraded in four or more years!
If for nothing else, the cloud should be appealing as a way to deliver the latest, highly configurable software transparently. Add to that the pay-per-use economics of the cloud and every manager, business or IT, should be thinking cloud.