Martin Molloy, Principal Consultant, Information Technology Advisory, Europe and Asia Pacific

You are likely familiar with the security and privacy and availability and performance issues in the cloud. However, the most pressing, long-term risk in the cloud is organizational readiness. Moving to a cloud environment is a significant change to the way in which an organization consumes IT services. The organization has to be ready to fundamentally change the way in which it interacts with both the business and service provider(s). One of the benefits delivered via cloud is the flexibility of enabling users to effectively provision services for themselves. This substantially increases the risk to organizations of losing control of their costs. Demand/consumption management becomes critical to the control of cost and the realization of the potential cost benefits that cloud can bring.

The second biggest risk for most large organizations is management of a complex, cloud-based commercial model. Most organizations have a fixed infrastructure with a more traditional pricing model. Introducing cloud to the delivery model will likely require a buying organization to manage more than one commercial/pricing model. This means managing a dynamic cost base as the transition from a more traditional infrastructure to a cloud infrastructure takes place.

For more on the cloud, download my latest paper, Cutting Through the Fog: What You Should Know About Cloud Computing and How to Get Started.

Filed under: Cloud Computing, Information Technology (IT), Market Trends and News, Outsourcing by EquaTerra