- The pressure is on organizations to leverage technology models like cloud services to improve efficiencies and cut costs, but many still struggle to produce workable on-demand computing strategies.
- Enterprises can learn from early adopters including the U.S. public sector, which has instituted mandates to encourage cloud use that should provide valuable insights to both the private sector and cloud providers.
Cloud computing is coming of age at a time when economic uncertainty and competitive pressures of globalization force organizations to be more efficient and more flexible. As much as an on-demand computing model appeals as a way to cut costs and increase organizational agility, making the transition to the cloud can be difficult and complicated for enterprises that have substantial infrastructure and legacy applications.
However, providers indicate that after some fits and starts, enterprises are moving beyond experimenting with test and development in an on-demand environment, to migrating more advanced applications into the cloud. In spite of some murky budget issues – or perhaps because of them – the U.S. federal government seems to be one of the more enthusiastic adopters of the cloud computing model: the government’s Cloud First mandate requires that agencies procuring new IT sourcing solutions must choose a cloud service when there is a secure, reliable and cost-effective option (see “The Public Sector is Jumping on the Cloud Bandwagon,” January 17, 2012).
Earlier in August, the Office of Management and Budget (OMB), the cabinet-level agency that oversees federal budgeting and procurement, published a directive to agencies requiring them to submit specific line-item data about cloud investments in their fiscal year 2014 budgets. This is tied to the OMB’s call to agencies that they slash their IT budget’s by 10% in the coming fiscal year, a significant cut from the 1% IT budget reduction requested in the FY 2012 budget.
This kind of direction from on high provides the catalyst many organizations need to begin making the sometimes challenging decisions required to migrate from legacy services to an on-demand model. The budget reduction directive also makes it clear that organizations need to base their cloud migration decisions on quantifiable cost-savings.
It is too early to tell how successful agencies will be in developing solid cloud strategies and executing on these plans to meet their budget goals and organizational missions. However, there is much enterprises in the private sector can learn from the ambitious direction of a U.S. federal government under stress. How is your organization developing its cloud strategy? Is it a cohesive enterprise-wide plan, or a more ad hoc approach?