The state of today’s enterprise mobile apps industry is akin to the dark side of a jungle: a dense forest and tangled vegetation, inhabited by hundreds of largely unfamiliar animals and plants that rely on its delicate ecosystem to survive, perhaps to thrive. This is creating frustration among stakeholders including the CIO, CFO, CMO, and CEO, who believe they might have over-invested in mobility initiatives.

However, this is far from the truth. Mobile apps have a long way to go in enterprise. Yet, to avoid the earlier pitfalls, enterprises and technology providers need to be fully aware of the following dangers in the mobile apps jungle:

  1. Business process transformation: Few enterprises or technology providers even consider that enforcing mobile access to an existing business process may be a poor idea. Making the end-user consume the same business process albeit through a different, perhaps “cooler,” app is not true mobility. User interest will not last if the business process is itself unsuitable for mobile. At the same time, not all business processes require this change. Enterprises must be selective in changing business processes while undertaking the mobility journey. Consultants, vendors, and others with vested interests will always extol the virtue of business process transformation for mobility, but enterprises should be very wary of this aggressive spiel.

  2. Line of business collaboration: In their desire to be the first movers, many line of business managers are creating all kinds of mobile apps with little collaboration with other business units. Given the increasing influence of non-CIO budget centers to approve technology funding, the tried and tested processes of application development are being compromised under a convenient, self-pleasing argument that mobile apps do not require a structured or “traditional” approach.

    Will this ad-hoc development blow up in our faces? I think it will. Can we prevent this? Unfortunately not. Business users are happy getting the needed application functionality on mobile devices, yet no one is thinking about the mobile application lifecycle. A long-term technology adoption framework is an unthinkable thought for these budget owners. They do not believe collaboration is their mandate or their responsibility. Their KPIs are linked to business outcomes, not to channelizing or seamlessly introducing mobile technology, and thus they will rarely ever have an incentive to create the needed structure.

  3. Cost of mobility: Enterprises and technology providers need to understand that while business agility, flexibility, and access is all good, the cost of these should not outweigh the rewards. Therefore, enterprise mobility should be viewed in its entirety to understand whether the incremental business has come at a greater cost of management and complexity. Yet the existing mechanisms across enterprises, where different unconnected lines of businesses are creating their noodly soups of mobile apps, does not engender great confidence that they will take a view of the broader picture any time soon.

  4. Mobility governance: It is fashionable these days to ignore any advice from someone who wants to instill structure or a governance model on enterprise mobility. Governance is perceived as “anti-growth” and “uncool.” Given this perception, few technology managers, despite their strong opinions, express any sentiments against the ad-hoc enterprise mobile strategy. This is a recipe for disaster.

So what can enterprises do to quash the mobile apps jungle’s beastly flora and fauna?

  1. Be selective about changing/transforming the underlying business process while mapping to mobile apps
  2. Create an environment that incentivizes lines of businesses to collaborate rather than compete in creating the next “cool” mobile app
  3. Adopt a lifecycle management approach to mobile apps
  4. Balance the growth objectives with the cost implications of enterprise mobility
  5. Incorporate an “eagle eye” to govern mobility projects

If you are undertaking an enterprise mobile application initiative and want to share your experiences and perspectives, please comment below or reach out to me directly at yugal.joshi@everestgrp.com.

Cloud-based services are distinctly different from traditional outsourcing not only because of the obvious cost and agility benefits but also because they fuel the need for a different kind of management of the services. From a management perspective the governance is transformational because it allows the governance team to change their focus on how they manage the services.

The distinction between managing cloud-based services and traditional outsourced services is critical to the outcomes and value achieved from the service.

In traditional outsourcing, the customer has a lot of say, particularly up front, in terms of designing the solution. The solution often starts with taking over what the customer currently has and then moves into a transformation journey. The customer is responsible for defining how the service components fit together and also is responsible for managing the use of those components.

But this tends to lead customers to overbuy. For example, in infrastructure the customer tends to buy more service space and more storage than is needed at any particular point in time just to ensure coverage for peak usage times and volume growth. Because it is cumbersome to contractually change the volumes, the customer ends up buying usage in step changes with the net result of overbuying.

But the real issue is how much time and effort it takes to manage this traditional kind of service. The governing cost in time and effort can overshadow the benefits of the service.

In contrast, the fundamentals of cloud-based or next-generation services are usage-based pricing combined with bundling. The customer buys bundled services rather than discrete components, and this impacts service management. For example, in traditional outsourced services, the customer manages how much capacity is needed for storage, how many licenses to purchase, etc. In the newer service models, the customer manages a few metrics around usage rather than managing the components that allow utilizing the service. The newer models enable customers to avoid the trap of overbuying.

But more importantly, cloud-based and next-gen service models profoundly change the governance aspect in the following ways:

  • Governance is much simpler and communication with the vendor or service provider is much simpler.
  • Governance efforts focus on how the organization consumes the services and on spending time helping the business units to better use the service for more value outcomes instead of managing the vendor or provider.
  • Governing demand management is much easier and reduces the complexities of billing and invoicing to keep track of usage.

The real issue of simplicity in governing cloud-based and next-gen services carries both good and bad news. The good news is that the simplification of management tasks means the customer will need a smaller management team. The bad news: The team will need a different set of skills. Instead of skills in managing vendors, purchasing, and invoice tracking, the governance team needs skills in change management, project management and business transformation.

At CloudConnect 2012, Everest Group’s Marvin Newell moderated a lively panel discussion on next generation IT governance. The panelists included Thomas Barton, Global Enterprise Architect at Novartis Pharmaceuticals; Jeromy Carriere, Chief Architect at X.commerce; and Erik Sebesta, Chief Architect and Technology Officer at CloudTP.

The panel focused on the governance concept of holding on loosely but not letting go. Though executive buy-in is important for cost-efficient and holistic migration to the cloud, the business unit knows operations and needs the best.

In the third CloudConnect video interview of the series, Erik Sebesta answers the question: How does one balance the decision-making between the executive team and the business unit?

In case you missed the first blog, this is the second video interview of a series we taped at CloudConnect 2012 in Santa Clara. Everest Group’s Scott Bils chaired the Organizational Readiness track and enlisted an impressive lineup of speakers.

Watch the first video, featuring Francesco Paola of Cloudscaling.

Watch the second video, featuring Simon Wardley of the Leading Edge Forum.

Watch the last video, featuring Clayton Pippenger of Quest.

In mid-February, I have the opportunity to join a great group of executives to debate how cloud computing will – nay IS – changing the way we need to think about IT governance. As you may know, Everest Group is chairing a track at CloudConnect in Santa Clara, CA, on Organizational Readiness. One of the sessions is slated to include Neal Sample of eBay, Bates Turpen of IHG, Thomas Barton of Novartis, and me discussing governance issues of today and tomorrow. We conducted a prep session last week, and I thought I’d share some of the topics we anticipate debating at CloudConnect.

  • Standards. One of the key pillars of capturing the value of cloud computing is the use of standard services to meet your needs. This raises the stakes for making the “right” choices early in your solution design and requires strong governance to ensure erosion of adherence to the standards is stopped in its tracks. Whether our discussion will start or end with a battle over the right approach to standards is unclear! What is the “half life” of standards decisions and how should you manage the balance of business and technical considerations that you will need to live with for some time?

  • Hybrid IT environments. Most agree that large enterprises will evolve to IT environments that include non-cloud and cloud components. The cloud landscape will also likely include internal (private) cloud environments and external cloud environments (virtual private clouds, public clouds, and Software-as-a-Service solutions). Controversy will be apparent on how big an enterprise should bet on cloud as THE focus of its go-forward plan. How should you balance the governance needs of these diverse environments?
  • Governance intensity. Cloud environments create the opportunity (nightmare?) for independent initiatives to be executed quickly and out-of-sight of centralized governance processes.  Some think these pockets of innovation and initiative are central to leveraging the full power of the cloud; others suggest this is a step onto the slippery slope toward anarchy in terms of IT governance.  What is the right approach?

  • Leadership. Who should take the lead in IT governance. There is a camp that suggests detailed technical decisions are shaped by governance decisions, so architects need to be in the middle of governance. Others argue that the business must set the vision and follow through to allocate resources consistent with those broad objectives or you’ll end up with disconnects that erode value from the outset. Sorting out these issues will be more than a sidebar skirmish! While most enterprises are likely to end up somewhere in the middle, how should you decide what decisions lean which way?

  • Management paradigm shift. Many governance processes have been established for IT approaches that are driven by capital budget management; i.e., large, lengthy projects are the centerpiece of how resources are allocated and policy is set and administered. Cloud computing services turn that paradigm on its end as easy-on/easy-off solutions that require little/modest capital come to the forefront. This fight will extend far beyond IT, encompassing the CFO and BU leaders. How does this fundamental shift in the underlying economics and what needs to be managed change the governance requirements?

  • Pace of change. The IT landscape has always been characterized by rapid change and short innovation cycles. However, cloud computing is accelerating this pace even more. With lower switching costs and innovation that presents opportunities to unlock ever-increasing value, the likelihood of opportunities to change directions increases with each service innovation. Risk takes on a whole new meaning in ways that will reveal fundamental differences of opinion that will light up the stage. How should an enterprise assess these opportunities? What must change in IT governance to accommodate the breathless pace of change inherent in the cloud?

With these topics in mind, the governance panel discussion at CloudConnect is certain to be lively and cover an array of challenging, if not controversial, issues.

If you have a particular area on which you’d like the panelists to share views, post a note to this blog and we’ll consider adding it to the list.

End users. Can’t live with them, can’t live without them. When procuring new IT solutions – a new opportunity for them in a corporate environment—they often like quick, flexible, and cheap. When working with current IT models, they value secure, scalable, and bullet-proof. Over the years, successful IT leaders have learned to help guide (read: manage) them through those trade-offs in a well-defined and disciplined approach.

Then along came cloud. For many consumers, cloud offerings seem to provide all that they are looking for, without the bothersome trade-offs. They are being told public cloud offerings can provide quick, cheap, secure, and scalable solutions. The beachhead for this type of messaging is often found on the fringes of enterprise-wide applications – just out of the reach and influence of traditional IT governance.

Many IT leaders have been caught a little flat footed with the recent marketing of cloud services to their constituencies, with the looming question being whether they should annex public cloud solutions from under the “control” of centralized IT governance wherein IT has authority over what can be purchased and how it can be deployed. This concept is counter to the pervasive centralization that for years has been justified by reasonable arguments around security, leveraged spend, and internal efficiencies.

So, what is the role of IT governance in the procurement of public cloud services?

On one hand, empowering end users and small groups within the enterprise to make their own decisions can improve the agility of the organization. Users can augment the enterprise portfolio to better meet needs with publicly available solutions. Demand can be harnessed by capabilities in the marketplace and budgets, not by the capacity of internal IT. Organizations empower their employees to make business decisions everyday to meet the firm’s objectives, so why restrict their judgment when it comes to IT solutions?

On the other hand, decentralizing IT decisions can bring about a host of issues that traditional IT governance handles well, e.g., architectural considerations such as interoperability, portability, security, and disaggregation of strategic information. With centralization, financial management can ensure the enterprise is optimizing spend, decommissioning underutilized services, and managing internal allocation models.

We believe the best course of action is to proactively define characteristics that a public cloud solution must have in order for the end user population to directly purchase services. One straightforward way to accomplish this is for the IT governance organization to publish a solution verification checklist. If the desired public cloud solution meets all the criteria on the list, the user has the authority to purchase directly from the cloud provider.

Examples of criteria on the “Yes” (the end user has the authority to purchase)/”If” (the proposed public cloud solution) list include:

  • Complies with the enterprise’s security requirements
  • Follows or preserves the business rules, business logic and data constraints pertinent to the information being processed
  • Preserves the integrity of the data and, if applicable, returns data to enterprise systems in an acceptable format and without data loss
  • Supports the integrity of the enterprise technical architecture
  • Does not sub-optimize the enterprise’s spend in any significant way
  • Does not require any resources within IT to support the solution
  • Fits within the acquiring entity’s budget constraints

Empowering users in this way, while not without risk, can enable the business in ways IT organizations often profess – speed being the primary. One of the emerging roles of IT governance is ensuring the enterprise’s needs are not compromised by the individual’s pursuit of cloud solutions. As we will explore in our next entry in this series, IT governance organizations have to find smart and sound ways to say yes, or run the risk of losing visibility into their users’ consumption of IT.

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