What is Cloud Portfolio Management?
In part one of this series, we provided some essential context for Cloud Readiness by framing the importance of developing a Cloud strategy, and determining whether your Cloud goals and objectives were incremental in nature, with a limited scope; or transformational and targeting the entire enterprise value chain. In this post, we present the Cloud Readiness Domain Model, and explore the first four elements of it.
Cloud Transformation Readiness Domain Model
The Cloud Transformation Readiness (CTR) Framework is illustrated and described in the sections below. The CTR Framework begins by examining six domains where Cloud computing readiness must be evaluated and understood, and then helps identify ways in which shortfalls or gaps can be closed or remediated. The CTR Domain Model is illustrated below:
Each of the Cloud readiness domains are described in detail in the sections below.
Cloud-Centric Leadership Creates the Environment
Any Cloud initiative requires demonstrated leadership to help ensure success. However, a Cloud transformation requires leadership to create an environment that is conducive to achieving the transformational goals of the organization. Below, the 360° Cloud Readiness framework is illustrated with Cloud leadership shown surrounding the six Cloud readiness domains — in essence creating the environment for Cloud computing success.
Cloud-Centric Leadership is a term I first coined in the eBook The Three Pillars of Cloud Computing Success: Such leadership, “Cloud-Centric Leadership,” is described below:
The first pillar of Cloud computing success is Cloud-Centric Leadership. Cloud computing is revolutionizing how IT resources and capabilities are accessed and consumed, specified and architected, and acquired, implemented, integrated, managed and provisioned. This proactive Cloud-driven IT transformation can be treated with distrust and disdain, or it can be embraced. IT must adapt to these forces or fade into irrelevance. We call organizations that embrace this proactive Cloud computing approach Cloud-Centric Leadership Organizations.
Cloud-Centric Leadership Organizations are proactive with Cloud computing, both from a technical and architecture perspective, but more importantly from a business and governance lens. Cloud-Centric Leadership Organizations will redefine the role of the CIO and the IT organization based on a model of integrated resource management, Cloud Governance principles, and the relationship management/resource broker model.
In the case of Cloud transformation, Cloud-Centric leadership extends beyond the Chief Information Officer (CIO) and the Chief Technology Officer (CTO), and into the ranks of business leadership. The CEO must show leadership, the rest of the C-suite as well, along with the other senior leadership of the enterprise. Cloud transformation leadership must be established and visible to create the environment for a transformative Cloud adoption approach.
Business Strategy and Finance
The business strategy and finance domain is focused on how Cloud computing can transform business processes, business capabilities, as well as products and services. In addition, the financial organization and processes are critical to the Cloud transformation given that Cloud computing requires a shift in budget planning and financial management processes.
For the Business Strategy and Financial domain, the Cloud readiness process seeks answers to the following types of questions:
- Does the business strategy include Cloud computing explicitly as an enabler of parts or all of the goals and objectives?
- Are products and services planned with Cloud computing as part of the product or service, or as an enabler of the product development and/or service delivery?
- Is the revenue model Cloud-enabled in any way? Does Cloud add incremental revenue, or enable more revenue to be achieved?
- How does Cloud computing impact gross margins and profitability?
- How does Cloud computing impact the end-to-end value chain processes?
- How “Cloud Native” is the cloud-enablement of the overall business model?
- The Business Strategy and Financial domain are critical components of Cloud readiness, as they set the pre-conditions for how Cloud will be adopted into business and IT processes.
Information Technology Readiness
Information Technology (IT) readiness focuses on the IT organization, personnel skills and knowledge, IT processes and capabilities and the overall ability of IT to drive a Cloud transformation process. Typically the IT organization leads the Cloud adoption efforts for major enterprises, and this is still largely the case in the Cloud transformation model. However, the IT leadership must also join with senior business leadership in extending the Cloud transformation into the business model and business processes of the entire enterprise.
Questions that indicate IT readiness might include the following:
- Are all IT leaders trained on Cloud computing fundamentals, concepts and strategies?
- Is there a Cloud strategy and roadmap defined for the organization?
- Does the Cloud strategy include Business input?
- Does the business strategy include Cloud computing requirements in the IT section?
- Is there a Cloud Program Management Office (PMO) or Cloud services team planned, chartered, staffed and trained?
- Has the Cloud strategy been communicated to Business leadership and all IT staff?
- Were stakeholders from the Business and IT disciplines involved in crafting the Cloud strategy?
- Are IT processes prepared for Cloud computing, from IT Strategy and budgeting to IT service management, help desk, IT operations, support and maintenance?
- Are there Cloud architecture and cloud solution architects trained and prepared to engage with Business unit stakeholders to help them adopt and consume Cloud services for their processes, products and services?
- Are service level agreements (SLA) defined for key Cloud services and needs?
- Is the Cloud operating model defined, tested and ready to commence operation?
- Is the technological Cloud environment and ecosystem ready for launch?
While many of the essential Cloud computing adoption processes and capabilities necessarily fall within the IT ownership boundaries, they are truly enterprise-wide needs. Hence, while IT must lead the initiative, the entire business organization must be involved to ensure success from a transformational perspective.
Organization and Cultural Readiness
The organization and culture of a given enterprise has a major impact on its ability to introduce change, as well as the potential for successful transformation. Organizational factors that influence Cloud transformation include the basic structure of the enterprise, how it is organized, where major groups are located, how centralized or distributed the enterprise is. Also key to the likelihood of transformation efforts are the corporate culture, the employee demographics, and the overall stance toward technology in the organization. Is it an aggressive technology adopter, or is it a laggard? How successful have major technology initiatives been in the organization?
- Cloud transformation readiness asks the following types of questions in the organization and culture domain:
- How it is the organization structured?
- Where are major groups are located?
- How centralized or distributed is the enterprise?
- How would you describe the corporate culture? What are the top three adjectives?
- What are the positive aspects of the corporate culture?
- What are the negative aspects of the current corporate culture?
- How has the corporate culture evolved over the last 3-5 years?
- Do these changes help or hinder technology adoption at an enterprise-scale?
- Do these changes help or hinder shared services models of IT delivery?
- What are the employee demographics?
- What is the Millennial composition of the organization?
- Is it an aggressive technology adopter, or is it a laggard? How have similar shared technology or shared services programs fared in this organization?
- How successful have major technology initiatives been in the organization?
- Is the organization capable of “Cloud Native” Business design, product development and process enablement?
Along with Cloud leadership, the organization and cultural dimensions of an enterprise also set the tone for how well major technology initiatives can succeed in an organization. Understanding the organizational design and structure, as well as the corporate culture, will help design the Cloud adoption dynamics to improve the probability for success.
In the next blog, we will explore the remaining four domains of the Cloud Readiness Domain Model.
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