“The biggest hindrance to corporate growth”

IT departments are “the biggest hindrance to corporate growth”, and they need to learn from the “shadow IT” workaround of other divisions bringing SaaS solutions in directly. That’s what David Linthicum, the curator of Gigaom Research’s cloud coverage, sees in his role as an SVP at Cloud Technology Partners, a cloud consulting and implementation firm.

In his view, IT departments on one hand get in trouble by violating IT principles in their approach to the cloud. But on the other hand their lack of responsiveness is the cause for line-of-business managers bringing in SaaS products in a way that may violate the compliance, security and integration requirements of the organization.  Too often, firms know what they want and need to meet customer demand, but IT is too slow in delivering on it.

Cloud computing is the technology that enables companies to break that cycle, but it takes great skill to leverage the agility of cloud solutions within increasingly complex hybrid and multi-cloud environments.

IT department mistakes with cloud

Among the mistakes David sees IT departments make with cloud are

  1. Bypassing traditional prototype and pilot approaches, with the resulting data points factored into ROI projections—and thus ending up with unworkable solutions by the time they call in external assistance, and
  2. Not factoring in the dynamics and cost of staffing with the skill set needed to manage a cloud environment.

Sticker shock

The cost and difficulty of staffing with the needed skill set may be what most takes IT departments by surprise. Although some employees can be retrained effectively for the requirements of cloud—and cloud vendors are happy to train them on their products—David says many staffers are simply not suited for challenging cloud jobs. For both implementation and operation, new employees must either be hired or contracted for with a service provider.

A service provider may be an easy choice for the temporary role of implementations, but even operational staff can be difficult to hire. In smaller cities in the U.S., they may be difficult to find, while in larger tech centers such as Silicon Valley, Boston, or Washington, DC, they can be found but are very expensive. For those shops in markets where they are scarce, contracting with a service provider may be the way to go. Either way, the sticker shock of salary costs can confound companies that haven’t factored it into their business case.

Recommendations for “shadow IT”

With  SaaS, sales, marketing, HR or other departments can go around a slow IT department to bring the applications they need into an organization more quickly. But such side-door technology purchases can lead to breaches in legal, regulatory and security requirements. David advises departmental executives tempted to bring in their own SaaS solutions to follow these minimum rules:

  1. Tell the IT department about what is being brought in, so security and compliance concerns, at least, can be addressed;
  2. Work with the IT departments as well as possible; and
  3. Don’t hide it!

How the smart IT departments learn

David believes that smart IT departments learn from shadow IT initiatives by learning the priorities, needs, preferences and preferred delivery for technology in line-of-business departments. Proactive IT executives are enabling their non-IT peers to continue to take the lead in such decisions, while also assuring that such purchases meet the security, compliance and integration requirements of the firm.

Relevant Analyst
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Laura Stuart

Analyst Independent Industry Research

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