Cloud Computing: What are those Top 5 Triggers that drive CIO decisions to Cloud?

Apart from betting on The Trend, what else triggers CIOs to switch on Cloud Computing projects in their landscapes? I look at the SaaS world for a start. And you might have observed, I still keep the decision making to the CIO. So, here is the question again. What are the top 5 triggers for a Cloud SaaS adoption decision in today’s world?

1. The Biggest Tech Trend (BT) Trigger: Do we need folks who don’t follow trends?

This is the obvious first. Remember those good old days when none ever lost their job for buying IBM. Fast forward to 2016. If their CIO is not thinking about Cloud SaaS, isn’t it safe for the Board to initiate a talent search?

2. Upgrade Decision Point (UDP) Trigger: Have to make a choice, I am already late.

Jump straight into the pool. I pushed my current on-prem system to the point of exhaustion. We hit a point in the system’s life where a decision to upgrade must be made. Now the question is: should I do this costly upgrade or should I evaluate SaaS as an option?

Upgrade Decision Point is a powerful trigger influencing migration decisions from on-prem to SaaS. Not offering any survey results for proof here. But I think most SaaS adoption decisions at large organizations that traditionally used on-prem models, could probably be traced back to this trigger.

For a CIO, it is an opportunity to avoid a costly upgrade and at the same time move on to a proven SaaS application platform that promises to hit the ground running and offers to stay updated all the time.

The only catch here is around the levels of custom features that the organization has built into its on-prem solution. If the new SaaS application platform can meet all the feature requirements then it is a great choice to make. If not, the CIOs need to decide on whether they can live with what SaaS application can offer and figure out a way to move business critical customizations onto a proven PaaS solution.

I would tie up this UDP Trigger to my view on how Cloud Computing delivered on the “Saves Money & Stays New” Hype Factor. Refer to my blog on cloud-computing-has-hype-turned-into-reality.html.

3. Budget Cuts (BC) Trigger: The ever green need to optimize and get more bang for the buck.

The only confirmed line item on budgets these days is the budget cut. This has been the trigger since the first industrial revolution for people to squeeze more from each dollar spent. Every CIO worth his title has faced demands and has plans to optimize BAU spend this year compared to what was spent last.

While CIOs are required to pursue optimization strategies on BAU spends and find dollars for innovation, there is always that need to generate ideas that contribute to growth and profits for the organization in today’s challenging times. Cloud Computing is probably one of those very few topics that can attend to this need. SaaS adoption projects have the potential to pull in net new dollar budgets from boards, with its promise of pay per use and low cash down payments.

4. Business Process (BP) Trigger: The attraction of “Best Practices” is irresistible.

Adopting Best Practices is another solid trigger. This covers an entire spectrum of organizational ambition, from cleaning up an existing mess, to streamlining & standardizing business processes, to mandating a centrally controlled business process across business units in various geographies, …., to successfully digesting & integrating new M&A transactions.

The Best Practices offered by market leading SaaS Software Solutions is a sure shot way to achieve this ambition. This can be in the back office space like HCM or Financials or Supply Chain systems or client facing SaaS like the CRM systems.

And finally,

5. Digital Transformation (DT) Strategy Trigger: The ambition to become a digital business.

A conscious choice is made to transform the organization. Aging of existing landscape, budgets and cuts, process optimization or latest trends does not drive far. The decision to adopt SaaS is part of a larger game plan driven top down from Boards and CEOs.

The game plan is not about doing a project, not about adopting SaaS for a process. Such a Digital Transformation (DT) Strategy might cover SaaS, IOT, Cloud, legacy modernization, automation, a new talent strategy and many more. It could mean re-imagining everything that an organization does and the experience it delivers to its Customers, Employees, and Stakeholders.

The DT Trigger therefore is driven by a more holistic organizational Business Strategy that is about arriving at a clear definition what value to bring to a particular target market, finding ways to create that value and getting paid for it. SaaS adoption will be evaluated based on how it helped the organization build the ability and agility to adopt into a digital business.

If you have any doubts about how aggressively the world is adopting SaaS, here is an excellent roundup on all market forecasts that you can refer to. http://www.forbes.com/sites/louiscolumbus/2015/09/27/roundup-of-cloud-computing-forecasts-and-market-estimates-q3-update-2015/#30f486f76c7a