New research from HCLTech shows that IT leaders overestimate how well their business counterparts understand cloud overall. More than half of the 500 leaders surveyed said that strategic decisions on their cloud-based projects are largely made by IT.

The research indicates that IT leaders must be more aware of the business strategy and then align their cloud utilization to the business strategy. While some business functions are more mature and have already moved applications and workloads to the cloud, the industry in general is seeing a persistent and gradual maturation with more work moving to the cloud.

Srinath Murthy, Senior Client Partner, Cloud transformation Programs EMEA DI-CS, TTL & France Consumer Service at HCLTech, notes that there is still a lot of headroom for businesses to fully appreciate and seamlessly adopt cloud services.

Why the disconnect on cloud continues

HCLTech’s research found that 91 percent of IT leaders believe that the potential and power of cloud is understood across every department. In contrast only 78 percent of business leaders say they understand the potential of moving work to the cloud.

Murthy says there are multiple reasons why there appears to be a gap between IT and the business. One consideration may be the perceived cost of migrating any service to the cloud.

Cloud offers a lower cost infrastructure, but there is some investment required to refactor, replatform or rebuild applications moving to it.

“The budgets for the business and for IT may be out of alignment. The business leaders may not be aware of the costs to transform the applications for cloud,” says Narasimhamurthy. “There are ways of mitigating the investment, but without this understanding the business may say they don’t have the budget for a big bang move to cloud. We work with the client and the cloud service providers to potentially plan for and manage those costs.”

He adds: “Another reason is that workloads moving to cloud may require a new way of working. Employees may need to change how tasks are completed when the application is delivered from the cloud. When a business is adopting cloud, there needs to be some knowledge transfer. There may be a significant cultural shift when businesses adopt cloud.”

Lastly, the fear of the unknown can impede the cloud adoption journey. Businesses may feel uneasy about how cloud complies with security policies and how cloud will enable data privacy and security. Cloud-based services can be as secure, if not more secure than on premise services, but the business may not be aware of cloud security as they contemplate a move to cloud.

“Educating the business can give them the assurance they need to move to cloud. Once they make the leap, they realize that the benefits, operational and commercial, are making a difference. This is an important part of the conversation that must occur between the business and IT leaders,” says Murthy. “It’s an evolution and we assist with this,” he adds.

State of security in cloud

Today, with the level of maturity in cloud adoption, there is far more transparency than ever before—making cloud platforms secure with enterprise ready infrastructure. Stringent levels of security, policies and principles have been applied, providing assurance and increasing confidence for many business leaders.

Despite this, the research found that regulated businesses, like financial services, have a higher level of hesitancy when it comes to cloud due to security concerns, among other issues.

The manufacturing industry has been an early adopter and their reliance on cloud continues to mature.  The retail, travel and logistics industries also fall into this category.

Extending strategic cloud decisions outside the IT department

To work with companies looking to engage both IT and the business in making decisions about adopting cloud, Murthy says that it starts with a “very open conversation on the obvious benefits of going to the cloud and what everyone can expect relative to change”.

“[HCLTech] typically has these conversations, inviting the selected cloud service provider to join the conversation,” he continues. “As a system integrator we invite the cloud service provider to join us in a meeting with our customer. We have the conversations with both IT and the business function.”

Murthy says that IT can run some of the workloads on cloud, demonstrating proof of value and how powerful the cloud can be, especially when it comes to scalability.

“It’s a journey. We explain how the business can benefit from moving to the cloud, while IT can demonstrate the value,” mentions Murthy. “There’s no shortcut to the process, and we have walked the path many times with clients in many industries.”

Another aspect is explaining how service providers structure the pricing and contracts for cloud. We work with IT and the business to understand the cost of the agreement with the cloud provider and ensure that the business case presented by the cloud provider will meet the requirements of both the business and IT.

“Commercial engineering, or the structuring of price and terms, may be as important as the rest of the elements under consideration,” says Murthy.

Besides understanding the impact of technology on the work of the business and addressing security concerns, understanding the mid to long-term view of cloud pricing and terms will enable the business and IT to successfully launch and navigate a cloud modernization journey.

To discover more insights from HCLTech’s cloud research, Cloud Evolution: Make innovation a habit, click here.