For most CIOs and IT leaders, the cloud approach is fairly simple. The well-known bouquet of IT benefits that cloud applications promise are, for most decision makers, substantial enough to take the plunge. After all, the lower cost of ownership, unmatched scalability, managed security and uptime, and regular upgrades are too much to ignore.
However, as enterprises mature in terms of their cloud adoption, the subsequent clohud application endorsements require stronger business cases.
This is where, ideally, you’d want to tie cloud to business metrics instead of IT metrics. More and more cloud service pitches are, as a result of this approach shift, focusing on direct business value instead of indirect value derived via IT. It’s time to look beyond reduced datacenter bills.
In this guide, we’ll discuss mechanisms and approaches that CIOs can adopt and fine tune to evaluate the business value creation potential of cloud solutions.
Consult users to create business value
Metrics are the time-trusted allies of IT leaders that help them understand how they’re doing in terms of adding value to the business. Look to communicate with internal customers and stakeholders to get a nontechnical understanding of which cloud related benefits matter most to them. Here are some best practices:
- Prepare a list of at least six to 10 metrics you’ve never tracked before to evaluate the cloud solutions’ business value.
- Engage in conversations with three to five business departments and functions to come up with a range of metrics that represent the enterprise’s notion of cloud-delivered business value.
- Your conversations with different business departments and their representatives will need to be purely nontechnical.
- Keep your tracking and reporting as simple as possible; ideally, adopt something close to the traditional red-yellow-green traffic lights-based status tracking.
- Your understanding of these metrics and their relevance will stand to be refreshed every quarter, at least, so make this a periodic activity.
Customer satisfaction of end users
The average age of the enterprise workforce is reducing, and is expected to reduce even more in the years to come. Millennials are already a major proportion of global workforce. The employees using all your enterprise’s cloud applications are in the best position to help you understand how the cloud strategy is succeeding in delivering value. CIOs agree – every cloud implementation must achieve, among others, the goal of making employees more productive.
The days when end users would float their request for additional functionalities in applications after getting the business director’s approval, only to be informed by the IT folks that it would take four to 12 weeks to implement, are long over. You’re dealing, or will very soon be dealing, with employees who know what they are asking for, and want it done it within a few days, not weeks.
Non-IT vectors to factor in your cloud strategy
With IT budgets becoming a hot topic of debate among C-Suite executives, the CIO can’t just rely on simplistic metrics that talk about the IT improvements that cloud solutions bring. Look to evaluate your cloud strategy and look to develop metrics in light of factors such as:
- Security and compliance considerations associated with every decision to put an application on the public cloud.
- Risks accompanying self-service models where business can procure cloud apps, which brings in flexibility but inflates governance challenges.
- The scope to drive collaboration and interaction among existing applications and proposed ones, helping business functions break down the barriers and isolation vectors separating them.
- The costs of vendor lock-in, which is a hard reality for enterprises that have already inked long-term contracts with the big players in the cloud solutions market.
Positioning cloud as a vehicle of business success
As an IT leader, you can position your enterprise’s IT department well by demonstrating how your teams have succeeded in helping the company achieve its core business goals. It’s time CIOs started viewing IT as a lot more than the provider of IT services to the company.
Measure the company’s performance in terms of how it’s exploited cloud implementations and investments in the past five years, and extrapolate them on the future to explain the potential IT has to deliver.
Does your company’s mission statement talk about strong financial discipline? (Don’t gamble your money away like Le Chiffre did with the African warlord Steven Obanno’s money in “Casino Royale”!) Is creativity the one word that defines your company? Are you crazy about quality (see Steve Jobs!)? You’d do well to identify metrics that connect cloud computing investments directly to the achievement of these core objectives. Nothing resonates with other key stakeholders within the enterprise like a demonstration of how an investment has (or will) improved the enterprise’s performance in terms of an operational objective it values highly.
More suggestions, tips, and tricks
Enterprise mobility is a major enabler for the workplace in these times. A workforce’s expectations around the use of applications remotely, using additional enablers such as end-user customization, and single sign on, etc., are on the rise. This is one aspect of cloud computing applications that can help IT leaders prepare strong business cases for the subsequent round of IT spending on the cloud.
Consider refreshing your understanding of the basic tenets of the SERVQUAL model, which outlines the basic factors that determine the notion of ‘quality’ that consumers associate with services. Look to map these factors to the benefits of cloud apps, and create metrics that demonstrate what the cloud has achieved for your enterprise.
Leverage the Goal, Question, Metrics (GQM) approach to brainstorm new metrics that capture the essence of well-defined critical success factors (CSFs) and are well-tied to business key performance indicators (KPIs). This method helps IT leaders quickly connect IT metrics with more business relevant KPIs.
As an IT leader, eventually, you want to demonstrate clearly how cloud computing solutions are delivering major business value to your enterprise (your stakeholders will demand it!). Business-aligned metrics help you always make sure that you’re driving the cloud vehicle well on the road of digital transformation.
Photo credit: Pixabay