By Jed Hewson, Director 1Stream
Last year, Forrester research issued a report stating that the pay-per-use model of cloud computing, in a scenario where application load varies over time, would always be a clear cost winner. The report was clear on the benefits of the cloud and hosting services, but there was, however, a clear caveat attached – perceived concerns around security, performance and reliability has left some business and IT managers simply more comfortable using their own in-house IT, regardless of the benefits of the alternative.
It was clear from the research that IT remains resistant and in certain cases, entirely opposed, to the hosted model. In-house IT departments, particularly in volatile environments like call centers, are employed to keep the technology up and running at all times. Unfortunately, this need for consistency is not conducive to the changes that this industry constantly requires.
The so-called “era of the customer” has meant that the marketplace can change at the drop of a hat. Being flexible and able to meet their demands can mean the difference between excelling or failing. Every minute, and every demand, counts.
It’s easy to paint a scenario – an operations manager may require a change to the existing tech, such as the introduction of a Workforce management tool. The in-house IT department (that is often under-resourced and placed under strict budget constraints) would have to approach their vendor to receive a quote, and spend a few weeks going back and forth to get the right pricing, and then – if approved, implement the system at a great cost and great risk. If that system proves to be of little use, they would have wasted a significant investment.
Change, in this scenario, is detrimental.
On the other hand, if that same operations manager had spoken to a hosted provider, the system could have been implemented within a matter of hours. Once activated, the tool could have been tested and even discarded with ease, at a low cost.
Hosting does not simply give business managers the opportunity to access technology that they may not otherwise be able to afford or implement – it gives business the opportunity to experiment. It’s scalable, instantly available and requires no investment in hiring, training or upskilling IT staff. They can freely diversify, test new technologies, explore new markets – without a significant capex investment.
Similarly, when dealing with in-house staff, there are no implications for not delivering an adequate service. When dealing with a hosted provider, there are contracts, SLAs and a relationship whereby the provider is required to maintain certain service level requirements at all times.
Control is not lost when handed over to an out-of-house provider – it’s intensified. Even if a company has devoted years to improving their security measures, in most cases, they are unable to access and afford the systems that a hosted provider can through simple economies of scale.
It’s apparent that business and IT goals are misaligned – IT requires a stable environment, business requires constant change to remain competitive. Hosting should not be seen as a threat to the in-house department, but as a way to give both parties what they need. Businesses are able to explore new markets and technologies through their hosted provider and IT departments are given extra time and resources to do much more than simply avoid disruption.
