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Does your cloud strategy FLOAT, or is it just FOG?

March 15, 2012 / Tim Allen

Over the past four years, I’ve been involved with more than 2,500 companies as they evaluated cloud-based technology solutions. My experiences have taught me some valuable lessons about what it takes to implement a successful cloud strategy, and there are a few that stand out above the rest. Last week, I sat down to think about what those attributes are, and I ended up with what I am now going to call FLOAT, an acronym for financial viability, love, on-time, alignment, and technical fit.

I’d like to take you through each one of these elements so that you can apply them as you evaluate your cloud solution. If it hits all five of these points, well, then it will FLOAT. If not, it’s time to reconsider your cloud strategy.

Here are the five key organizational requirements that will help business leaders determine if their cloud strategy will FLOAT, or get lost in the fog.

1. Financial viability. Before spending any amount of time considering a cloud-based solution, stop and make sure you understand the financial ramifications of the endeavor. Does the cloud-based solution align with the financial goals of your business?

Every business should have a formal process (established in a written document) that is used to determine the financial feasibility of implementing any new technology. If this document does not exist, company stakeholders must agree at the onset which measurement strategy is best suited to determine how well a cloud-based model will fit in with the current business model of purchasing, implementing, and managing technology.

Whether it is ROI (return on investment), TCO (total cost of ownership), NPV (net present value), LMNOP, or some other benchmark, executives must agree that the method selected will be the final word on determining the financial viability of the solution.

2. Love. If everyone is on the same page with the math on the money (i.e., you’ve determined the financial viability of implementing a cloud solution), it’s time to take a more intuitive read of the situation. Never underestimate the emotional aspect of buying decisions. Does everyone love the solution? The “l-word,” though a much less objective factor than the first, is a very real force to be reckoned with.

Does the solution, regardless of the delivery model, have real benefits to the business? Does it reduce costs, causing CFOs to fall head over heels? Do operators swoon over the productivity gains the solution provides? Or does it offer less tangible (but equally important) feature benefits that end users fall in love with?

Look for signs, or flat out ask people how they feel about the solution, and try to establish whether they like the cloud-based delivery model more or less than premise-based. Of course, if the top dog loves the solution, the floatability factor increases dramatically.

3. On-time. Timing is everything. If the time is not right to implement a new technology, don’t waste a second of your time scheduling meetings with vendors or evaluating a migration.

Review all contracts and obligations related to your current technology and technology partners. Find out when the next maintenance upgrade from your existing vendors is scheduled. Understand the depreciation of all assets in the mix. And for goodness’ sake, make sure that your organization is in the mindset for change and is ready and willing to implement a cloud-based solution before you go down that path.

4. Alignment. For the cloud-based strategy to float, you need to gain acceptance of the model at all levels of the organization.

Some parties in the organization will be more inclined to accept the cloud than others. For example, end users likely won’t care how an application is delivered as long as it works and offers at least as much functionality as the current model.

The CEO, too, is likely ready to jump on board, probably having listened to multiple sales pitches and success stories of his or her peers.

CFOs love the cost savings associated with the cloud model, but don’t want to worry about the fallout of a failed technology implementation. As a result, they will need to know that the CIO or IT decision makers accept the solution before jumping on board themselves.

A major key to success will be ensuring that everyone — from the top dog down through the C-suite to the end users — accepts and aligns themselves with the new cloud strategy.

5. Technical fit. A cloud strategy will only be successful if it is a technical fit for the organization. Unfortunately, this determination isn’t always black or white.

If the cloud-based solution you are considering is identical to your current premise-based solution in everything but delivery, most of the objections go away. In this scenario, there is no need to retrain staff, wait out the user learning curve, or figure out how the new solution will integrate with your existing systems. There is virtually no interruption to the business. The only technical issues that will need to be addressed are related to the security and availability of the solution in its new home, the cloud. If you are evaluating the right solutions, these issues should be easily resolved.

If the cloud-based strategy you are considering will introduce a new application, then technical fit is largely determined by the ability of the CIO and/or IT decision-makers to maintain control. This is complicated by how attached your IT people are to the tools and technology already in place, as well as by the cost of the tools and talent needed to maintain those applications.

Many times, IT pros believe their value to the organization is determined by their knowledge of the existing technical environment. They are the ones that are relied on to support a critical cog in the corporate wheel. Replacing the technology that an IT organization is known for without providing an alternative it loves could turn your cloud strategy into mere fog.

Additionally, you will need to conduct a detailed engineering review of the cloud solution’s compatibility with the current environment. This should be a very transparent and objective process to determine if the cloud services under consideration make technical sense.

There is most likely an opportunity somewhere in your business to take advantage of the cloud model. After all, it does provide real benefits, like saving money, simplifying administration, and preserving the environment. The key is to find an area where a cloud-based solution will FLOAT. Otherwise, it will likely turn into FOG (financially unclear; objections not overcome; going with the status quo).

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