By Martino Corbelli, Marketing Director, Star:

Dispelling the Myths

Organisational change is often confronted with confusion and a fear of the unknown and this has never been more true than in the case of managed services that are delivered through the Internet, commonly known as Cloud Computing or Software as a Service (Saas). For years now IT professionals have always cited the ‘data security’ excuse as the de-facto automatic response to anything presenting the remotest possibility of detaching them from the comfort zone of being able to touch their own computer servers. By stark contrast, those IT professionals that have been embracing Cloud Computing, however, seem to be having a very different experience that puts this old attitude into serious question.

What this seems to suggest is that the real threat to IT jobs is the resistance to be the driver of this transformational change that is now upon us. Businesses are now looking to transform themselves and become Internet-driven and IT professionals that champion Cloud Computing in their business will elevate their own status by harnessing the business benefits this presents. Those that don’t may well become the victims of change when their business leaders make the decisions for them and in turn it is this threat to their jobs that could fuel the self fulfilling prophecy that they fear most.

Technology Transforming Business

Cloud Computing is now transforming the way business people use and pay for the technology that supports them. This is all the more reason why the IT department would benefit most by being the protagonists, rather than being left behind. Gartner defines Cloud Computing as, “A style of computing where scalable and elastic IT capabilities are provided as a service to multiple customers using Internet technologies.” We are now at a tipping point in a revolution where business decision makers can make their own IT decisions and have a solution managed and delivered for them, without having to talk to anyone in the IT department. It is not uncommon for a sales director to purchase an online Customer Relationship Management (CRM) solution, without first consulting with his IT Manager.

UK businesses want to remove the burden of complex and expensive IT overheads where they have up-front investments in hardware and software followed by ongoing, and often unpredictable costs of maintenance, support, upgrades, migration, business continuity, disaster recovery, back-up, archiving and fixing things when they inevitably break. All of this presents massive operational and financial risk to any size of business. To break this downward spiral businesses are looking for new solutions based on an Internet-driven, on-demand model that are easy, flexible and available anytime and anywhere. The threat to IT jobs is, therefore, from within.

Business Technology is Now in the Cloud

The situation has become untenable and any self respecting IT professional that thinks we can continue on the traditional technology merry-go-round is in for a nasty surprise. More to the point, they are not doing their employers or themselves any favours. The economic climate may have accelerated the need to take action but the basic business pressures for change were already well under way. We need IT to be better, faster and cheaper, and technology needs to provide the platform that delivers business agility, aiding organisations to focus their existing people and resources where they actually need them. To do this they must align IT strategy to the business strategy and this is an opportunity for everyone concerned, especially those in the IT department.

A Yankee Group report in 2009 that examined time allocation of IT departments in UK SMEs showed that almost two thirds of time is spent on tactical, non strategic tasks - with 40% of their time taken up just on maintenance alone. Where is the business value in this and how does this help UK businesses get a measurable return on their investments? Surely, if ever there was a threat to IT jobs then this would be it? Further, complexity is multiplying, increasing the risks of human error, and not every organisation can afford to hire the highly skilled professionals they would need in order to do everything in-house.

Worryingly, in the same report, Yankee Group found that only 14% of time was actually spent educating the business about technology. This suggests a lack of strategic input and alignment of the IT function to business objectives. All of this is underlined by statistics from McKinseyQuarterly that say computer room running costs are increasing by 20% per annum. If IT budgets are increasing at all in the current economic climate, they won’t be anywhere near those levels. UK businesses are now looking for service providers they can trust to alleviate these problems.

Confidence in Cloud Computing Grows in the Board Room

Star’s own research of Business Managers shows growing confidence in the security of third party data centres, with the largest group of respondents (44%) consider their data is safer and more secure in a professionally managed data centre, with round the clock support, rather than on their own hardware based at their office premises. This compares with 34% who believed that data was more secure in-house. Contrasting these findings with results from an IDC survey in October 2008, which cited security as the number one concern with cloud/on-demand computing with 74.6% of IT Executives, unsurprisingly, confirming their fears above those of performance and availability.

Business leaders are now ahead of their IT colleagues when it comes to their vision of utilising data centre services. They appear more comfortable with entrusting data to a third party. Senior executives and CIOs seem to already have got the message that their data is much safer in an environment that has the best levels of security and is managed 24/7 by professional staff, something that most SMEs would find prohibitively expensive to try to emulate themselves.

Taking IT from Basement to Boardroom

Cutting costs is still the big issue for UK businesses and we’re seeing increased demand for Cloud based Internet services that provide access to enterprise grade solutions, at a low and predictable monthly fee, with no upfront or capital expenditure. These services are appealing because they can be delivered to any employee, anywhere and at anytime. This means that business leaders can make quick and easy decisions about deploying the right technologies to support them without having to recruit more IT people. They can instead get more out of the assets, the people and the budgets they already have today.

Resistance to change is always a feature of any business transformation but it is this resistance that presents the biggest threat to IT jobs and not the medium by which the transformation is taking place. Yes, it may mean new skills need to be acquired and it definitely means letting go of tactical activities that add little value to the business but surely this is a good thing? Moreover, if IT is to take its rightful place at senior executive level then this approach is essential to help UK businesses to:

Reduce costs

Improve service levels

Free up company capital

Future proof IT investment

Quickly access new technologies

Keep control of IT and focus on growth