Have you ever thought about the impact of cloud on your business operating model? Implementing a Cloud First Strategy is changing the way businesses run, and you need to change with it.
In collaboration with Matthew Boyley, the Chief Information Officer and Chief Digital Officer of the Department of Industry, Innovation, and Science, Infront’s General Manager, Advisory Services, Jeff Penrose, offers a unique insight into the impact of cloud in business, and why businesses need a new operating model when moving to cloud.
Transforming Your Operations is Critical for Cloud Success
A Target Operating Model is defined as an abstract representation (model) of how an organisation delivers value to its customer or beneficiaries using cloud services.
Think for a moment about how a central IT function delivers its data centre services to the various business units it supports today. This is a well-defined operating model, which has been tried, tested and improved over a long period of time.
Now forget most of that, because cloud adoption is a transformation and you must rethink your approach across people, process, and technology, to achieve the benefits of cloud. You cannot simply rely on existing models built for the data centre as you will surely fail or gain little benefit.
A cloud strategy may bring substantial infrastructure savings, but typically this represents only a small percentage of total IT spend – the greater opportunities lie in operational efficiencies and benefits to the business itself. Speed to market and the ability to work more iteratively and adaptively to deliver what customers and businesses really want are real step-changes enabled by cloud. To truly transform, it’s the people and processes that are the most important, however, they are often ignored because they are considered the most difficult to change.
New Target Operating Models
Detailing a Target Operating Model provides a big picture of what the future business may look like across business and technology domains. It brings everyone on the team to the same page, promoting a sense of purpose and a common mission. The ideal Target Operating Model should focus on both hard and soft elements as well as structures, systems, skills and shared values.
The fundamental constructs of a Target Operating Model will provide the building blocks to define business and system architectures, allowing you to create a roadmap for reimagining IT and accelerating the benefits that a cloud-first strategy can bring.
The Importance of Vision for your Cloud First Strategy.
Our experience has shown that the fastest way to fail in cloud is to jump straight to technology delivery. As a culture, we are very action-oriented, but this tactical approach to cloud delivery often results in services being delivered without alignment to business needs or expectations. This misalignment results in a loss of trust and ultimately, relevancy with the business. This is where the first part of the Target Operating Model comes in – ‘Cloud Vision’.
Your cloud vision can be implemented in stages, growing the maturity and understanding of the possibilities that cloud represents. As described above, changing the people and process can be difficult as change is often met with resistance within an organisation. To address this, Infront developed their Cloud Journey Map framed around incremental cultural ‘wins’ that takes the customer on a journey of discovery and acceptance. As a customer passes each ‘maturity gate’, a new discipline is introduced to help further accelerate organisation maturity and transformation to a Cloud First model.
Your Hybrid Cloud Journey
At one end of the spectrum, we introduce a Limited Service Catalogue to help accelerate service delivery around a controlled set of offerings. This ‘non-threating’ first step ensures that IT teams can begin to understand the power of automation and cloud. It also sounds the horn of change across the business by delivering outcomes in days instead of months.
We work with many organisations who struggle to deliver simple services, such as VM provisioning, in under 5 months – frustrating the business into action, often outside the control of IT. This must be avoided at all costs. While the business action is an important step in the long-term transformational journey, this replicates the old model of IT service delivery and hurts the business for reasons that include uncontrolled expenditure, stranding of data and security risks that aren’t properly understood until they are realised.
At the other end of the scale, a fully evolved organisation will have the unprecedented ability to deliver everything-as-a-service with a mature Cloud First framework. With 85% of all new workloads being deployed to cloud, this level of maturity is critical to finally closing the innovation gap that has emerged between business demand and ITs ability to deliver.
The most important takeaway, however, is that it’s critical to discuss and agree with your internal and external stakeholders on your Cloud Vision so that you have aligned direction and strategy for cloud usage within the organisation.
Aligned with the Cloud Vision are your ‘Cloud Principles’ which comprise simple yet specific statements on how you will execute your strategy. These should highlight aspects of the organisation that must change in order to enable the future strategy.
Equally, these should also identify strengths that must be preserved, call out the critical decisions and explain which capabilities are essential to realising your business benefits.
Examples of principles are:
- SaaS first, PaaS second and IaaS third.
- Enable customers to consume standard patterns through self-service.
- Support a repeatable deployment process that balances user requirements with security and cost controls.
Target Operating Model
People, Process, and Technology
Now we have a vision and a set of principles to evaluate against, we create organisational models to see which of the proposed structures provides the best fit.
A typical approach is to map out the interactions between your consumers of cloud services within the business, the proposed suppliers of the needed services within your organisation and the internal stakeholders who will have a voice in shaping how consumption happens – think of the likes of the security compliance and finance teams. This will tease out the necessary roles.
While defining the future organisational structure and new roles, Infront’s Innovation Exchange offers a well-defined operating model and technology architecture. The operating model contains the services and related business processes that you can use as a guide. The clear benefit of this mature framework enables you to define the standards and deliver advice on the roles required for adopting cloud technologies. There may be existing people within the organisation who can be retrained into one of the new roles. You might need to go out to market or acquire the skills through other channels. It usually ends up being a mix of both. Our 20 years of experience is yours to leverage, to short-circuit this complex process.
Infront’s Service First Methodology is a great place to start when determining what processes, you need to be developed in support of your Cloud First strategy. They will broadly encompass the BAU processes and activities you would want to include in your Target Operating Model. Most of the cloud vendors also have best practice assessments that provide a good basis from which to build upon. Responsibilities for these processes are mapped out via a RACI Matrix, to allow the assignment of each functional role in the process to an expectation. This ensures that one person, or team, is committed to producing results and decreases conflict and ambiguity. Agreement of the RACI with stakeholders is important to ratify the organisational structure.
Finally, we get to the technology layer where new tooling is often required to support the identified business processes. Although driven by customer requirements, Infront developed Unity – a hybrid cloud reference architecture, to help accelerate your cloud first adoption and minimise risk in the transformation process. However, we do recommend you build a checklist to map the technologies and the business processes they support. If looking to reuse some existing tooling, it’s important to understand any restrictions from a technology and commercial perspective. Many cloud-native tools will come with a usage model which makes sense when using the elasticity and scalability of cloud technology.
To define your Target Operating Model, you need to work with your internal consumers and stakeholders to agree on the vision and principles that will help you achieve a common goal and strategic direction. When defining your vision, ensure that you map this back to the business goals to achieve the expected benefits that cloud technology brings.
Rethink your approach across people, process, and technology because this is a transformation, not an iteration of the data centre era. If organisations don’t re-define the people and process layers, changes in technology alone will be almost destined to fail.
Infront have many years’ experience partnering with enterprises on these transformation programmes. We inspire organisations to take a journey to cloud. We will be there with your every step of the way as you define your Target Operating Model and design your cloud first journey roadmap. We remove the complexity out of this otherwise daunting journey, to save your organisation from the pitfalls others have experienced. With a complete list of services delivered as Managed Outcomes, or using our “build with” approach, we ensure that knowledge is transferred during the process. This enables cloud success for the organisation.
Infront brings your cloud intentions to life, ensuring you have the best chance of understanding and leveraging the key benefits of cloud.