Why Moving To The Cloud Might Be A Bad Idea For A CIO

Moving to the cloud is not always the right decision
Moving to the cloud is not always the right decision

Image Credit: Melinda Swinford

If you’ve taken the time to read any of the IT trade rags in the past year or so, you’ve seen a story that tells you how wonderful “the cloud” is and how it has become a key part of the importance of information technology. In fact, if you’ve read enough of these articles, you may be thinking that you are a bit behind the times – your company should be moving more of its applications into the cloud faster. However, it turns out that a number of companies are not making this move. Their reasons may interest you…

Why The Cloud Might Not Be The Right Solution

Let’s face it, there are a whole host of very good reasons for moving into the cloud. These include lowering your cost of buying servers, not having to worry about software updates, lower staffing needs, etc. However, there are always two sides to any coin.

Every company uses a collection of software applications to run their day-to-day activities. Not all of these applications are the same – some are considered to be more important than others. As an example, an application that is used by the Human Resources department to manage staff is an important application, but it’s not critical to the financial success of the company. That makes this kind of application a good candidate for moving to the cloud. If there was a cloud outage, it would be an inconvenience but not a disaster for the company.

On the other hand, the large scale Enterprise Resource Planning (ERP) packages that many firms have installed and customized to run their business are critical to the financial success of the business. If these types of software applications become unavailable to the business for any length of time, it would have a negative impact on the company’s bottom line. Due to the risk of moving an application to the cloud, these ERP applications are not seen as good candidates.

How To Strike A Cloud Balance

The problem with not being willing to move a large, critical application like an ERP application into the cloud is that it means that the company won’t be able to realize all of the cost savings that they could experience by making the move. People with the CIO job are split on this issue. A recent survey revealed that more than half of the CIOs interviewed are going to move some of their workload into the cloud while 1/3 said that they are quickly moving to the cloud.

The manufacturers of the large mission critical applications are starting to understand the situation that their customers are finding themselves in. What they are doing is starting to roll out modules that can run in the cloud which can be added to existing ERP applications

People in the CIO position who realize that they have two separate problems to solve (cost reductions and increased availability) know that they are going to have to create their own solutions. Moving less important applications into the cloud is a no-brainer. When dealing with mission critical applications, finding a way to create a hybrid solution appears to be the key. Allow non-critical functions to run in the cloud while keeping the core functionality running on servers that the company controls.

What All Of This Means For You

It goes without saying that “the cloud” has arrived. What this means for CIOs is that we now need to start to make some decisions regarding where we want the company’s applications to run: in our expensive data centers or somewhere in the cloud?

Many firms are willing to move their less important applications into the cloud in order to realize the cost benefits that come from doing this. Applications like human resource databases are good candidates for this. However, ERP applications that are used to run the business are not. The risk of a multi-day outage that would cut off access to the ERP application is just too great for a CIO to chance. Instead, a hybrid solution that combines the best of data center based solutions with cloud components will probably be used going forward.

The good news is that you have not missed out on the cloud revolution. In fact, by not racing to place all of your firm’s applications into the cloud, you may have prevented cloud outages from impacting how your company does business. You will eventually move some or all of your applications into the cloud – the economics are just too compelling. However, take the time to plan out the order in which you want to move applications so that the rest of the company can keep on working.

– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World IT Department Leadership Skills™

Question For You: If you move an application to the cloud and then have problems, what would make you move it back to your data center?

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What We’ll Be Talking About Next Time

As the person with the CIO job, you now live in a world that is filled with lots and lots of real-time data. It comes from your customers, your manufacturing, your partners, and, of course, your company’s web site. Having access to this much data via the arrival of cloud computing is great news. However, now it’s going to be your responsibility, because of the importance of information technology, to determine what to do with it and how to gain knowledge from all of it.

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