Outsourcing and the cloud


Outsourcing and its younger and faster-growing cousin, cloud computing, have come to occupy an increasing amount of time in the planning of CIOs — to the point where some are wondering if they will have a job in five years.

The short answer is, of course they will: Their IT departments may have shrunk, but someone knowledgeable needs to advise C-level executives on information technology strategy.

One of the problems, Joe McKendrick points out in a column for Forbes.com, is that the first choice of organizations, outsourcing IT operations to service providers, doesn’t help lines of business get closer to IT. In fact, he cites a survey that says almost a quarter of outsourcing clients would boot their current provider if they haven’t helped them standardize, automate or transform business processes soon.

This is not a ringing endorsement of outsourcing, and may explain why some organizations are eager to bring IT back into the company.

Is cloud computing the answer? It can bring IT closer to the enterprise in the sense that solutions are narrowly focused — think Salesforce.com for customer relationship management, or Workday for human capital management — and are often subscribed to by lines of business impatient with IT departments slow pace of software development.

On the other hand, cloud apps can be less flexible for some organizational needs. Some, but not all. That’s one of the things CIOs can advise on.

So as outsourcing comes under question, a different type of outsourcing — cloud computing — is elbowing its way in. The advantage, as many point out, is that cloud solutions can free IT staff to addressing other priorities (security, developing apps that the cloud can’t provide). How CIOs structure strategy and counsel both lines of business and the C-level will take strength and insight.




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