It used to be that every IT technology project needed to be a business -- to have a business justification. Now, every new business project "needs to be a technology," noted Mark Tonsetic, analyst with the CEB unit of Gartner.
"Digital is the new battleground" in the evolution of the modern enterprise, he said, and even the CEO wants a story to tell Wall Street about how his company is going digital. For optimists, that means new revenue opportunities and short time to market for new products. For pessimists, it means the company may not stave off disruption but at least it's making a move to avoid it.
Tonsectic described how CIOs and IT directors might navigate these newly choppy and hazardous waters in a session at Interop ITX on May 19, How The Cloud Is Changing IT Investment Plans. The goal isn't to make just the right investment in cloud. It’s to fit cloud into an IT ecosystem that has all the right components needed by the transforming company, he said.
In an interview before Interop ITX, Tonsetic noted that cloud is already included in the investment planning of most companies. The degree of investment depends on how much the cloud is judged to be helping the company make its own transformation to the digital economy.
Want to see additional advice from CEB on the changing approach to IT? See Three Ways CIOs Can Take the Pain Out of Digitization.
In his talk at the Las Vegas show, Tonsetic said a decision on how much to invest in cloud computing can't be made in isolation from other IT investment decisions. IT is being called on to make investments by lines of business that have less and less interest in waiting for technology to be "properly" vetted. Tonsetic said CEB has been tracking the number of companies that say they are willing to adopt high-risk, emerging technologies, a number that stood at zero in 2012, rose to 25% in 2013-14, rose further to 40% in 2014-15; then fell back to 27% in 2015-16.
Tonsetic recalled a Fortune 500 company chief technology officer telling CEB, "We used to have some discretion over which technologies we'd deploy. Now our business partners expect 'yes' as the default answer" when they propose a technology initiative.
With their employers willing to take greater risks, Tonsetic said IT managers have little choice but to embrace the risks and try to make it work. IT will have to make the investment in new technologies and systems but perhaps it needs more of the trader's outlook on "puts and takes." A trader may make multiple bets based on what he thinks are likely scenarios, but he constantly checks news and events against the assumed probabilities.
IT should likewise check the planned technology implementation against its appropriateness to changing conditions. In some cases, before IT gets over committed, it's wise to try to do a cost benefit trade-off and if necessary, kill the project. Innovate and experiment to try to serve business needs, he advised, "and have an exit strategy" just in case.
Use of the cloud is more and more become about what it enables within the enterprise in terms of flexible product development and fast time to market, with cost a secondary concern. "Cloud decisions will be as much about capability, if not more, than cost," he said.
CEB is a former independent market research group that was acquired by Gartner in April for $2.6 billion.