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Cloud Computing

Klaus Holse Andersen (Europe) - How Cloud is Engineering a New Breed of CIOs

Once exclusively a technology expert, the CIO’s job has morphed into a hybrid role, combining technology knowledge and business acumen. Until now some executive boards have seen IT investment as only a cost rather than a source of added value and a key competitive asset. Now, as IT becomes increasingly pervasive through the adoption of cloud computing, there is a trend emerging as CIOs are being forced to take a much broader role in the business. To maintain their position as a valuable member of staff, CIOs need to be fundamental to driving business transformation, innovating for competitive advantage and acting as key strategic partners to the CEO, the executive board and the wider organisation. 

A CIO needs to have a deep understanding of the technology, the business and the customers. Balancing these needs is essential because it is likely having the skills in only one area is not enough to lead the IT in an organisation, especially a large and complex one. Moreover, CIOs in this position may find themselves struggling to find the right perspective to inspire and lead other people in the organisation.

Over the next few years, cloud computing will increasingly transform the way CIOs operate. More organisations will turn to cloud products such as software as a service (SaaS), which will continue to mature. A computing model that quickly delivers capacity on demand with significant cost savings is an increasingly attractive prospect for businesses. At the same time this new method of computing is forcing an increasing number of CIOs to rethink how they support the day-to-day needs of their organisations, help them achieve corporate objectives, and fulfil their own career goals.

The successful ‘hybrid CIO’ not only integrates the goals of fellow CxOs into a coherent organisational vision but also becomes co-creator of business strategy. Instead of falling victim to the changes which the cloud is driving in European organisations, CIOs must embrace the cloud and adapt to survive.

Some CIOs are already profiting from this change and seeing their role broaden as a result of the adoption of cloud services. At British Airways for example, the CIO is broadening his role to include the title of ‘head of services’ for the airline, a trend they expect other technology-dependent companies to follow. Intel and Boeing are two companies who have taken a similar approach, both allow IT employees to work in other business units to broaden their knowledge, and hopefully return with cost savings ideas. Intel offers IT workers the opportunity to work with other business units for two months to a year, while Boeing has adopted a two-year rotation program for its workers. At Netherlands-based logistics company CEVA, the CIO Peter Dew heads both IT and HR.

The cloud can help the CIO to become even more influential across the enterprise. Whereas in the past, compliance and regulation issues may have fallen to the legal department, the CIO will be at the centre of understanding the legal challenges affecting cloud adoption across continents, as governments look to build a framework that can withstand the test of time, protect consumers, and leave industry breathing room to innovate. As cloud matures and more internal IT functions move to the public cloud, IT management will become less of a task, further threatening the traditional role of the CIO. While cloud will increasingly commodify IT, the opportunity is ripe for CIOs to position themselves as innovators.

Through the adoption of cloud services, and to ensure a continued presence in C-level conversations, a CIO must look at moving the cloud computing discussion past technology and economics and onto the major benefits such as business agility, time to market and competitive positioning. If you talk purely technology, and only in terms of Iaas, SaaS and PaaS the chances are you’ve already lost your audience.

The promise here is one of establishing a new role for the CIO that is much more aligned with business strategy; the challenge will be to ensure that IT isn’t completely dis-intermediated in the process, with users going directly to vendors to satisfy their needs. It’s likely that the impact of the cloud breaks down for IT leaders similarly to every other change – some will see it as an opportunity to enhance their role within the organisation, while others may tend to view it as a threat and treat it as such. It’s the former that will win big as Europe embraces the new cloud era.

No executive is better placed than the CIO to develop the fullest appreciation of the nuances of business processes, and the specific challenges of an organisation's various functional domains. Tomorrow’s CIO must have the proficiency to be heir apparent to any senior executive position. Any CIO today who simply wants to stay in his or her current role is unlikely to ever realise their full potential and grow their own career.

By Klaus Holse Andersen, area Western Europe vice president, Microsoft

 

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