Driving Communism Out of IT with Cloud Computing

By Leslie Muller (Profile)
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Monday, August 22nd 2011
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Enterprises spend too much time and money delivering IT resources that are not tailored to what business users really need. There are many reasons for this, but they all stem from one basic problem: IT departments operate on the centrally managed economic principles favored and loved by communist states. As a result, they practice behaviors that lead to an inefficient, rigid and one-size-fits-all environment. In order for IT to truly enable competitive advantage, it must adopt a free-market economy—which is exactly what cloud computing enables.

How Communism Manifests in IT

In Eastern Bloc countries of years past, economies were run by central committees. Everything was governed by Five Year Plans that government teams adhered to regardless of whether market needs shifted or demand even existed anymore for the products being produced. There was a mismatch between supply and demand, which resulted in an overproduction of goods that people didn’t want, limited product options, and a severe shortage of the goods that people did want. And because there wasn’t real competition—or market-driven pricing—inefficiencies were rampant, goods were often of questionable quality since factories were measured by the number of products they produced, rather than whether they worked as intended, and prices were artificial, instead of reflecting true cost or value.

The parallels with enterprise IT are obvious. It’s common knowledge that IT committees are responsible for setting policies and making decisions that affect—yet don’t necessarily reflect the needs of—the end user. While having policies at enterprise and departmental levels is critical for compliance and security, the problem is that the IT teams tend to operate in isolation of the end user. This doesn’t allow for the course corrections, customizations and consumer empowerment needed in a dynamic, global marketplace.

Similar to the Eastern Blocs’ Five Year Plan, most IT organizations operate on multi-year capital refresh cycles. The larger the organizations, the longer it takes to get new devices, operating system upgrades and application enhancements. As in communist economies, options are limited. For instance, employees may be able to choose from two or, at most, three flavors of hardware configurations along with the one “approved” software configuration. The same goes for servers; developers or business groups are given a couple of options in terms of CPU and RAM and hope that one will be close enough to meet their requirements. Business and end-user timelines for new software and hardware are vastly shorter than what central IT can deliver. It’s not unusual for the organization not to have a true Total Cost of Ownership for devices, software and environments. Even if the company is willing and able to set aside the needed funding and staff resources, it often takes weeks, if not months, for IT to procure and then deploy the approved goods.

Traditionally, there has been no real competition for enterprise IT services. Although some users may venture outside the company for help, most must try to get their needs met through corporate IT. And, without looming competition, no matter how well-intentioned IT is, there is little means or incentive for IT to change the resource request/approval/delivery process. In the meantime, employee productivity suffers and competitive advantage can wane.