Cloud computing is traditionally implemented as an infrastructure service model to reduce IT costs. Cloud models have evolved to prove it is a better business solution with many benefits. Today, business organizations big or small having understood the abilities of cloud services are using cloud in their organization to transform their business capability, to improve agility and to gain competitive advantage. From the perspective of business technology clouds offer measured service, on demand self-service, redundancy, resource pooling, scalability and broad network access along with other technical benefits.
Due to global economic downturn, IT departments are currently re-evaluating their IT strategies to fulfill three main financial demands: initial capital expense, operating costs and return of investment or time to value. Therefore, CIOs face the challenge of delivering more with less due to reduced budgets. The role of CIOs is also changing from managing IT operations to a more strategic business role to develop business value, foster innovation and overall business growth all using technology.
Cloud services offer an ideal solution to fulfill these demands because IT projects continue to be critically evaluated on these demands. Cloud computing offers huge potential for easily overcoming most of the challenges faced by CIOs in terms of providing secure, faster and cost-effective alternative to internal application development and management. Here are some reasons why CIOs should adopt cloud computing.
- Faster time to value: Companies normally delay projects that take time to deliver ROI. CIOs can make use of fully pre-built applications and project management services that streamline design, coding, testing and training and so on in the cloud. Developers can quickly create user experience by defining the data model and business logic in a cloud environment to result in delivery of faster time to value.
- Requires no upfront capital costs: CIOs can benefit from subscription pricing model available with cloud computing platforms. The pay-as-you-go model significantly reduces risk because projects can be scaled based on customer satisfaction. Also in clouds no upfront capital cost for purchase of hardware is needed.
- Significant reduction in operational cost: Clouds offer multiple environments which benefit developers, testers, trainers and end users. All these environments are available as an integrated service which is ready to use. CIOs can make use of available services that include administration, centralized management and governance, etc. which significantly reduces project time and cost. Also cloud adoption eliminates capital costs for purchase of new hardware.
- Extensive technical resources are not required: The cloud service provider handles all resources needed to support applications and maintenance. CIOs have the advantage of optimizing cloud resources for more business growth.
- Overcome challenges in integration: Integration is easy with cloud models as enterprise applications can be quickly deployed and made available. Existing legacy databases from major business categories such as SCM, HRM, ERP, etc. can be integrated easily with enterprise applications such as SAP, Oracle, etc.
- Enterprises are more TCO aware: The cost benefit analysis on cloud usage within the enterprise can be quickly realized by organizations. For example, each business case can be determined for its value by adjusting resources in the cloud. CIOs can be sure to realize agility which comes along with TCO. Since performance metrics are established for agility, the organization can easily realize TCO.
- Cloud accelerates innovation: Cloud deployments significantly minimizes time, expertise and separate technology resources needed for innovation. CIOs can quickly provision resources for experimentation cycles or innovation thus enhancing time to market.
- Potential for more revenue and opportunities: Cloud models avoid duplication and redundancy across all departments in the organization. Business strategies are aligned with IT. CIOs can focus more on product launch in new markets, identify potential opportunities, innovation and business growth.
- Better customer engagement: Cloud systems have the ability to handle large data storage and perform analysis on them efficiently. CIOs can use this analysis to gain business insights easily from customer data and use it for improving business outcomes.
- Security and compliance: Security and privacy are handled well by clouds as they offer in-depth protection to data and applications. For instance, private cloud models offer SLAs and privacy protection assurances for organizations. In addition to security, compliance requirements can be fulfilled by the CIO by defining appropriate data ownership and controls in SLAs with cloud providers.
In addition to the above reasons for cloud adoption by CIOs, there are numerous other benefits for both business and IT. CIOs can help business growth by improving connections with suppliers, etc., enhance employee productivity and optimize operating expenditure and so on.