Oracle Vice Chairman Jeff Henley spends a lot of time talking about cloud computing to C-level executives all over the world, drawing on his own background as a CFO to add to the conversation. Not only does this help him spot cloud trends quickly, but it also gives him a birds-eye view of cloud evolution. And according to Henley, there are some interesting signals that cloud is hitting the mainstream. “It’s early days of this transition, but it’s definitely way beyond the early adopter novelty stage at this point,” he said.
Henley spoke in Boston at Oracle CloudWorld, which continues in New York January 13. Clearly, cloud adoption is not a one-size-fits-all proposition. Digital startups, for example, may live in the cloud from their inception, while older companies have to figure out how to combine cloud with their existing IT footprint. But with that in mind, the following five questions should help you assess whether cloud is mainstream at your company, or if you’ve got some catching up to do.
1. Is cloud a boardroom topic? Most CEOs that Henley speaks with are not only aware of cloud, they understand that ignoring it—along with big data, analytics, mobile, and social—will endanger their companies.
“Most of them see that they have got to change somehow because there’s just a lot of different kinds of competition coming now,” he says. “Some of them have figured out what they need to do about it, some of them are still searching for what they need to do about it, but I’d say by and large that they all get it to some degree.” As a result, many companies have elevated strategic digital transformation discussions to the executive suite.
2. Are line of business users driving integration discussions? Integration is old news within IT, which spends a disproportionate amount of time and resources tying together disparate systems. But for early cloud adopters, shadow SaaS adoption has been around long enough to drive the point home to the business side as well. “A lot of business users who originally said, ‘I’m going to bypass IT, they take too long,’ now realize that they still need some help to get things integrated,” said Henley. And once LOB users understand the importance of integration to their work, they become willing partners with IT. “In the old days, shadow IT was a server under somebody’s desk, and today, it’s an actual real application that has a lot of capabilities,” says Henley. “For that to be coming out of the shadows and being dealt with on an enterprise basis is a good thing.”
(Bonus prediction: Henley thinks that integration will eventually lead cloud users back to software suites. “The history of our industry is that suites win,” he said. “Harvard Graphics and Lotus 1-2-3 were great, and one day Microsoft invented Office and the suite took over. The reality is that when you buy from a lot of different vendors, at some point it’s got to be integrated.”)
3. Is your company modernizing its IT infrastructure? IT is often characterized as slow to respond to business innovation, but the responsibility of maintaining existing applications gobbles up the lion’s share of most IT resources, says Henley. “It’s hard to look at new things, it’s hard to be innovative, when you’re consumed in doing all the day-to-day stuff,” he says. That’s why companies that are further along the cloud adoption curve recognize that infrastructure modernization is crucial to digital innovation. “The reality is, you have to do both—they kind of go together,” says Henley. “The more you modernize, the more nimble and flexible you get.” Moreover, modernization also drives down maintenance costs, allowing IT to devote more time and money to innovation.
4. Customizing SaaS apps is for saps? One of the attractions of cloud is its immediacy—instant provisioning, transparent upgrades, immediate scalability. But in order to get the most from cloud, companies must avoid software customization, which slows deployment, costs more, and vastly complicates software upgrades. Early cloud adopters have already figured this out, says Henley. “The business guys today are much more knowledgeable about that, and they’re willing to give up some degree of functionality if they can get that speed.”
5. Are your talent needs changing? Companies that are further along with cloud have discovered that they need different skill sets to successfully effect digital change. For example, Henley says that Oracle wasn’t moving quickly enough to digital marketing until it acquired several cloud-based customer experience companies, and discovered the value of the different skill sets and approaches its new employees brought to the table. “It helped us understand how far the market had moved and we were able to internalize things and totally revamp the way we approach selling,” he says.
So what do these questions tell you about cloud at your company? Are you in the cloud vanguard, or still planning your strategy? If it’s the latter, Henley suggests that you get moving. “It’s not too late, but you have to recognize you’re behind, and you really ought to be deciding and putting a game plan together.”