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© 2014 IBM Corporation
October 2014
Cloud bound
Advice from organizations in outsourcing relationships
© 2014 IBM Corporation2 © 2014 IBM Corporation
Companies that outsource
infrastructure and applications
are increasingly i...
© 2014 IBM Corporation3 © 2014 IBM Corporation
But the journey to cloud is different when you’re “in a
relationship”…
Sour...
© 2014 IBM Corporation4 © 2014 IBM Corporation
Those already traveling this path can offer important insights to their pee...
© 2014 IBM Corporation
Wherever you are in the journey, expect some twists in the road
5 © 2014 IBM Corporation
© 2014 IBM Corporation
Know your traveling partners well
6
Don’t underestimate the time and effort required to
get informe...
© 2014 IBM Corporation
Protect your passengers
7
There are new risks to think about – enlist your
partner in building conf...
© 2014 IBM Corporation
Chart the itinerary together
8
Stretch the limits of existing engagements and
tap providers’ expert...
© 2014 IBM Corporation
Keep everyone on course
9
Cloud comes with a ripple – help the
business adjust
Revamp processes
“Th...
© 2014 IBM Corporation
Plan for arrival
10
Be mindful of the need for integration plans for
both platforms and vendors
Min...
© 2014 IBM Corporation
Case study: Measured steps into the cloud, aiming for rapid transformation
11
Started with low
risk...
© 2014 IBM Corporation
Case study: Relying on experience to put critical capabilities on the cloud
12
Looked for an experi...
© 2014 IBM Corporation
Case study: Leveraging contract flexibility to move critical systems to cloud
13
Sought an
experien...
© 2014 IBM Corporation
As you navigate your journey…
14
How will you progress your cloud road map with your provider? And ...
© 2014 IBM Corporation15 © 2014 IBM Corporation
Start small – but don’t stop there
© 2014 IBM Corporation
Appendix
16 © 2014 IBM Corporation
© 2014 IBM Corporation
In-depth interviews with companies in transition
17
Respondents were remarkably candid about what o...
© 2014 IBM Corporation
Explore your
options
Acknowledge
concerns
Engage incumbents Revamp processes Mind the gaps
Educate
...
© 2014 IBM Corporation
Wherever you are in the journey, expect some twists in the road
19 © 2014 IBM Corporation
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Cloud bound: Advice from organizations in outsourcing relationships

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Mixing cloud into your outsourced IT services - For organizations that are involved in outsourcing relationships, the path to cloud can have some twists and turns. There are 5 rules of the road worth keeping in mind:

1) Know your traveling partners well
2) Protect your passengers
3) Keep everyone on course
4) Chart the itinerary together
5) Plan for arrival

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Cloud bound: Advice from organizations in outsourcing relationships

  1. 1. © 2014 IBM Corporation October 2014 Cloud bound Advice from organizations in outsourcing relationships
  2. 2. © 2014 IBM Corporation2 © 2014 IBM Corporation Companies that outsource infrastructure and applications are increasingly incorporating cloud into their IT services mix
  3. 3. © 2014 IBM Corporation3 © 2014 IBM Corporation But the journey to cloud is different when you’re “in a relationship”… Source: http://www.computerweekly.com/opinion/Forrester-The-impact-of-cloud-on-outsourcing-contracts
  4. 4. © 2014 IBM Corporation4 © 2014 IBM Corporation Those already traveling this path can offer important insights to their peers
  5. 5. © 2014 IBM Corporation Wherever you are in the journey, expect some twists in the road 5 © 2014 IBM Corporation
  6. 6. © 2014 IBM Corporation Know your traveling partners well 6 Don’t underestimate the time and effort required to get informed about alternatives Explore your options “Talk to cloud firms about their development process, how they source data centers, and how they manage code and do releases. Really understand these new techniques.” – CIO, Manufacturing Educate stakeholders “You have to break it down, explain it multiple times. The business hears appealing buzzwords. But they want assurance from IT.” – Senior IT Director, Pharma Get to the technical experts fast “You really have to get past the sales guys, to the people who are actually doing the cloud work, so that your technical team can begin to understand what might be possible in your context.” – CIO, Manufacturing
  7. 7. © 2014 IBM Corporation Protect your passengers 7 There are new risks to think about – enlist your partner in building confidence Acknowledge concerns “Our old-school security folks didn’t want anything to go to the cloud. But we said, ‘Cloud isn’t going away – so how do we make sure we’re protected?’ Rather than putting up walls, be part of the solution.” – Senior IT Director, Pharma Get your providers’ help “Once you’re comfortable that a vendor has broad experience with public and private cloud, you can trust them to explain the key security architectures and parameters.” – CIO, Healthcare Require assurances “We require formal external security audits – ones explicitly designed to test cloud delivery models. This data is so sensitive to our business that we want to be sure providers are continuously on top of it.” – Head of Procurement, Consumer Goods
  8. 8. © 2014 IBM Corporation Chart the itinerary together 8 Stretch the limits of existing engagements and tap providers’ expertise Engage incumbents “Rather than asking ‘Where do you want to go?’ we want providers to bring us turnkey solutions, show the business case, stage workshops. We’ll get the right folks in the room.” – Senior IT Director, Pharma Keep expectations high “It’s important for vendors to bring innovation, not just deliver what you’ve signed up for. We require biannual meetings with the provider’s senior technical architects to brainstorm technology and platform improvements.” – Head of Procurement, Consumer Goods Influence vendor platform “We found things the vendor’s platform couldn’t do that you would have thought obvious. For instance, you could expand capacity but couldn’t back it down. But they’ve been pretty good at working with us and shaping their roadmap.” – Services Delivery Director, Healthcare
  9. 9. © 2014 IBM Corporation Keep everyone on course 9 Cloud comes with a ripple – help the business adjust Revamp processes “The way we consume IT services has changed. Procurement and legal organizations must understand that. You need to retool, or lose the advantages of cloud because related processes will be too slow.” – CIO, Manufacturing Keep stakeholders engaged “We won’t do anything without close interaction with our senior clinical officers. They have to know and support the effort. A CIO housed on his or her lone branch is doomed to failure. We have regular meetings to update the President and senior LOBs on where we are.” – CIO, Healthcare Prepare for transitions “We’re working with the business to negotiate outages. We keep reminding them that once we migrate to the cloud, their service costs will drop.” – Head of Procurement, Consumer Goods
  10. 10. © 2014 IBM Corporation Plan for arrival 10 Be mindful of the need for integration plans for both platforms and vendors Mind the gaps “We've noticed some integration barriers that still exist, especially in integrating not only data flows but also users coming in from remote sites.” – CIO, Healthcare Appoint an integrator “I want my current service desk to be the first port of call for cloud options being considered. The key benefit is that I end up with a single, integrated model. I don’t have multiple integration points and multiple places to go.” – CIO, Engineering and Business Services Have a plan “In the future, we’re not going to see one gigantic cloud player. We’re not going to put everything in a single basket somewhere in the cloud. I honestly believe it will be a combination, a portfolio of partners.” – CIO, Consumer Goods
  11. 11. © 2014 IBM Corporation Case study: Measured steps into the cloud, aiming for rapid transformation 11 Started with low risk areas Looked for ways to leapfrog Positioned cloud strategically Got the key stakeholders involved early Aligned with the business Manufacturer renegotiated two outsourcing contracts eCommerce Backup and recovery • Create a roadmap to move aggressively into the cloud • Evaluate other providers for future cloud solutions • Address privacy and security concerns methodically
  12. 12. © 2014 IBM Corporation Case study: Relying on experience to put critical capabilities on the cloud 12 Looked for an experienced vendor, and asked for proof Took an incremental approach to moving workloads Addressed security concerns head on Analytics applications, HR, CRM • Place newly developed applications on the cloud • Move more workloads to the cloud • Enlist the right resources from the provider Pharmaceutical company split outsourcing contracts to get to the next level
  13. 13. © 2014 IBM Corporation Case study: Leveraging contract flexibility to move critical systems to cloud 13 Sought an experienced vendor with global reach Took a “crawl before you walk” approach Pursued flexible contracting Consulted with counterparts (in other orgs) to build confidence ~10% of their outsourced activity • Aim for the low hanging fruit and gradually build • Evaluate migration of business intelligence and data analysisConsumer goods company extended outsourcing to new geographies
  14. 14. © 2014 IBM Corporation As you navigate your journey… 14 How will you progress your cloud road map with your provider? And where do you jump in today? What will it take to get your security and compliance teams comfortable with cloud? How will you collaborate with your provider on innovative solutions? What is the best way to keep key stakeholders and business leaders informed and part of the cloud decision process? Who will be responsible for integrating your multi-vendor, hybrid IT environment?
  15. 15. © 2014 IBM Corporation15 © 2014 IBM Corporation Start small – but don’t stop there
  16. 16. © 2014 IBM Corporation Appendix 16 © 2014 IBM Corporation
  17. 17. © 2014 IBM Corporation In-depth interviews with companies in transition 17 Respondents were remarkably candid about what organizations should expect when making this kind of transition. They shared important advice, based on what’s worked well and what hasn’t. Double-blind qualitative study 10 in-depth interviews with IT outsourcing decision makers from large enterprises ($1B+) in the US, UK, and Canada Industries included pharma, insurance, manufacturing, healthcare, consumer goods, and engineering and business services The majority of respondents were CIOs or IT Directors Respondents had an IT outsourcing contract with an existing vendor within which cloud was being adopted or evaluated. They also were using a host of outsourcing vendors.
  18. 18. © 2014 IBM Corporation Explore your options Acknowledge concerns Engage incumbents Revamp processes Mind the gaps Educate stakeholders Get your providers’ help Keep expectations high Keep stakeholders engaged Have a plan Get to the technical experts fast Require assurances Influence vendor platform Prepare for transitions Appoint an integrator 18 Here’s what executives said to expect along the way – and their advice on addressing each challenge
  19. 19. © 2014 IBM Corporation Wherever you are in the journey, expect some twists in the road 19 © 2014 IBM Corporation

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