The CIO as Gateway for Innovation
Agility and flexibility are two of the key values of Wipro Consulting's vision for the 21st Century Virtual Corporation. The adoption of these attributes assumes the externalization of all non-core related activities to utility operators. Cloud provides the perfect platform for such development. Using private/public cloud-based models to provide the majority of business processes, we can imagine a virtual corporation that does little more than develop brand, define product and orchestrate external alliances. Sound familiar? That's exactly what Coca-Cola, Dell and Cisco have been doing for years.
Cloud providers fall into roughly four groupings:
- Consumer-based utilities such as Google and Amazon, who, with surplus compute power, are looking for new sources of shareholder value;
- Traditional IT vendors such as IBM, HP, Microsoft and AT&T;
- Service integrators, who are going to orchestrate this new environment; and
- Niche players, who see many new opportunities in areas such as security and service brokerage.
In our experience, few companies demonstrate a comprehensive cloud response to internal IT needs even at basic compute, storage and desktop levels. CIOs are concerned about security, technical integration, acceptable service levels and data protection regulation. With the exception of a few well-published success stories, most CIOs merely see cloud as a means of converting CAPEX (associated with fixed IT assets) into OPEX (pay as you go). Current cloud expenditure remains minimal.
We recently surveyed CIOs about their IT expenses on cloud-related services. Only 20 percent reported that they allocated more than 10 percent of their budget to cloud. Almost half have designated less than 2 percent.* What will change your mind about adopting cloud? Ramped-up deployment of business initiatives topped the list of drivers in our informal survey. CIOs we surveyed are also intrigued by the conversion of IT capital expenditures to operational expenses. They embrace infinite scalability for storage and computing as well as IT agility. Collaboration ability is seen as an asset, as are the large-scale benefits achieved by combining cloud with mobility. Most CIOs expect cloud penetration to rise to 40 to 50 percent within the next five years.**