The cloud is transforming IT management, whether organisations are building their own private cloud infrastructures or moving their data and apps onto external public cloud networks. This HP white paper examines what is happening as a result of this transformation and some of the issues we need to overcome in order to extend the cloud's central role further.
IT losing corporate control
Traditional IT departments are losing corporate control of their data through cloud services. At first, this was a gradual shift, but is now a seemingly widening sea change in the way a whole organisation connects to the IT department.
The rise of mobile and remote working, the BYOD movement and the uptake of cloud services - including 'self-service' on-demand functions like HR - have fed into this relationship change, and the bottom line is that the IT department will have to adapt otherwise it will end up as a non-entity in some quarters of the business world.
The days when only the IT department had the decision as to whether a particular mobile device or app could be supported on the corporate network are long gone, as other departments - like HR, sales and marketing - are increasingly being given the power to choose the IT they need to run their operations.
Executives in the cloud saddle
The cloud offers executives the business control they demand, so IT departments will need to become more collaborative and innovative as a result.
The rising adoption of cloud services is fundamentally changing how businesses consume IT, according to a Cisco report in conjunction with Intel.
The report found that in a majority of organisations, control of IT planning and purchasing is increasingly being shifted to lines of business (LOBs), such as HR, sales and R&D. Their rising influence represents a marked departure from the traditional 'top-down' approach, forcing IT departments to adapt.
The Cisco Impact of Cloud on IT Consumption Models report – based on a global survey of over 4,000 IT decision makers – found that while 43 per cent of funding currently comes from LOBs, 59 per cent of respondents predict this will rise.
Indeed, the cloud is said to represent almost a quarter of total IT spend (23 per cent), with that figure expected to rise to 27 per cent by 2016, further demonstrating its central role in these changes,
Given that 70 per cent of respondents believed that IT planning will increasingly involve stakeholders from LOBs, and 59 per cent believe purchasing authority will also eventually reside with LOBs, the role of the IT department looks set to change forever.
No longer rogues
When the first cloud services appeared - largely around software-as-a-service, infrastructure-as-a-service and platform-as-a-service models - it was often said that the cloud would encourage 'rogue' IT buying - executives getting out their company credit cards to purchase cloud services that would be accessed over the corporate network without the IT department's permission.
This scenario isn't seen as 'rogue' or illicit any longer, as such behaviour is accepted or even encouraged by many senior executives, who have bought into the benefits of using cloud services, specifically lower costs and scalability in tune with the needs of the business.
In an increasing number of cases, the IT department is effectively competing with the cloud when it comes to providing technology services to the business. Tight collaboration with other departments and the adoption of cloud working is now a prerequisite for a relevant and successful IT department.
Other research shows that half of organisations believe that cloud adoption has changed the role of their IT department, but more than four-fifths still anticipate having a need for a distinct department until at least 2020.
The cloud enables IT innovation
While the transformative potential of cloud computing is having a profound effect on how the IT department operates, it is facilitating a change in focus towards strategy and innovation rather than rendering it obsolete, according to research commissioned by managed service provider Claranet.
For the research, 300 IT decision makers from a range of SMEs and SMBs were questioned, and 49 per cent said cloud adoption changed the role of IT departments.
Of these, 57 per cent said the IT department was now more strategic in its outlook, while 55 per cent said that cloud computing had put their IT department in a strong position to provide new solutions for the organisation. So it seems the cloud is a strong opportunity for the IT department, rather than its death knell.
This shift in focus was emphasised by organisations' expectations of what the core activities of their IT departments will be in the future. The research found 54 per cent thought data security would be a key function for the IT department in 2020, while technical support was cited by only 46 per cent.
The IT department is safe
More than four-fifths (82 per cent) believed that their organisation will still have a need for a distinct IT department in 2020, rather than its functions being entirely outsourced or absorbed by other internal departments.
Reducing pressure on in-house IT teams was a key objective of cloud migration projects for three quarters (75 per cent) of respondents. But of those organisations for whom adopting cloud services has changed the role of their IT department, less than a quarter (23 per cent) have seen it reduce in size.
The fact that IT departments have not been widely downsized as a result of cloud adoption points to the IT department being given the opportunity to become more strategic to the organisation. More than ever, with the help of the cloud, the IT director or CIO that can show what they are bringing to the bottom line should be able to shine.
However, for the business and IT department love-in to continue, big obstacles remain to be overcome, not least those around cloud security and standards.
Security still an obstacle for most
Security is still the biggest barrier when migrating data to a cloud service provider (CSP), according to research from infrastructure-as-service (IaaS) provider Databarracks.
The research surveyed 400 IT professionals from UK-based organisations, and 58 per cent still see security as the biggest concern when moving data to cloud services. Over 60 per cent identify security procedures and policies as the most important aspect they look for when selecting a CSP.
However, evidence also points to companies no longer stalling in the face of such concerns, with many proactively implementing policies to overcome security anxieties.
The survey found that 64 per cent are considering, or have already put in place, an official policy restricting employee use of consumer cloud services such as iCloud and Dropbox. And 43 per cent of organisations are also reviewing their security policies in light of the recent US National Security Agency PRISM revelations.
Peter Groucutt, managing director at Databarracks, says: "Security is always going to be the major priority for those considering a move to cloud services, as you are often trusting a third party with your company's most sensitive data.
"However, the difference highlighted in the research is that organisations are no longer seeing this as a roadblock, but rather an opportunity to review their current security practices, and implement effective new policies that protect their data and enable a more confident move to cloud services."
But what about the obstacle created by a lack of cloud standards? Cloud standards are not set to reach maturity until 2015, according to the APM Group, the Cloud Industry Forum's (CIF) independent certification partner.
The CIF has the backing of major companies involved in the cloud market and its certification partner has called on the European Union to encourage and implement an effective code of practice, rather than develop a new generation of pan-European standards.
The European Commission (EC) has previously laid out its strategy to create a single set of rules for cloud computing in Europe, designed to help increase cloud sales in the region and increase transparency in the sector.
One of the key tasks assigned to the European Telecommunications Standards Institute (ETSI) was "cutting through the jungle of standards" to identify "a detailed map of the necessary standards for security interoperability, data portability and reversibility."
An effective framework of cloud standards through this initiative, however, is still 18 months from maturity, according to ETSI and others involved.
Richard Pharro, APM Group's CEO, commented: "Unfortunately, one of the primary challenges that the authors of standards face is one of time. Standards take time to develop and refine, and lag industry developments, so as soon as a particular standard has been devised and gained traction, the industry will have moved on."
He added: "Given its rapid pace of change, this is felt acutely in the cloud industry, making the task at hand all the more difficult. Developing new standards takes years, whereas developing an effective code of conduct could take months."
He also said that the industry and cloud users should instead get behind the CIF Code of Practice. He said cloud codes are more agile than standards, and can account for the differing legal frameworks of EU member states, and can be easily upgraded as and when required.
Whether the CIF initiative meets the requirements of the industry is still up for debate, but like security, for the continuing transformation of IT management to carry on through the cloud, these issues must be thrashed out.