Moving to the Cloud Doesn’t Eliminate the Need for Integrated IT Services

John Marcus

John Marcus

Summary Bullets:

  • With IT infrastructure being virtualized and moved off-premises into the cloud in an effort to manage fixed costs, IT organizations – including outsourced resources – will inevitably shrink.  Automation cannot replace everything, however, so enterprises should continue to keep their IT service providers around.
  • Services integration may be the latest buzzword among key providers, but it makes sense to use an IT integrator to help navigate the simultaneous complexities of cloud migration, internal downsizing, use case development, and tactical IT purchasing.  Knowledge of the business environment is an invaluable differentiator for in-house IT providers and they should capitalize on this to remain relevant.

As IT resources move off-premises into the cloud, IT organizations on-premises will get smaller.  External services will replace those resources, but the expectation is that this will be achieved by increased automation via the cloud.  So, on the one hand, enterprise services will need to replace management functions formerly offered by in-house IT, but on the other hand, do it more efficiently than traditional outsourcing.  The pressure will be on IT service providers to take more responsibility, for potentially smaller contracts, from increasingly demanding customers.

The shift to using the cloud by enterprises is causing a disruption to traditional infrastructure and outsourcing service models.  The ability to access IT capacity – whether it is computing power or applications – on an on-demand basis is not compatible with traditional multi-year service contracts.  Enterprises are looking at IT infrastructure less as general business process and more as a tool, and they are choosing to buy IT products and services for tactical reasons, or for opportunistic reasons, or for very specific and narrow use cases.  The availability of IT (or other resources for that matter) in a dynamic fashion cannot help but change the way it is used, so service providers are going to have to adapt in order to respond to those changes.  Enterprises need to make sure they can do this, but they also need to remember that some services cannot be virtualized and automated.

Enterprise IT departments should be mindful that shifting traditionally outsourced resources to a cloud model can result in losing the value traditional IT service providers bring to the table.  Yes, alternative service providers ranging from hosting companies to software vendors to mobile operators can deliver significant IT features and functionality very efficiently through their cloud offerings, but they do not necessarily have the same level of expertise in pre-deployment planning, legacy integration, tactical out-tasking, and other qualitative features that are at the heart of traditional IT services.

Enterprises should absolutely pick and choose between the various premises-based and cloud-based solutions, and between public and private cloud, and between on-demand compute to run their own applications versus using SaaS through a hosted provider.  However, here is where the old-fashioned SI can come in handy as a kind of services integrator, advising on which services to use, but also bringing them together and packaging them for specific use cases.  Instead of going to an HP or IBM and asking them to bid on a specific solution, an enterprise might instead go to them and ask for advice and assistance on how to solve a business problem using existing IT resources, SI resources, and third-party resources, including hardware, software, and networking.  This could be for a one-off engagement, but it could also be an ongoing relationship as a nominated services integrator.

About John Marcus
John is a Principal Analyst for Business Network and IT Services at Current Analysis. His focus is on new developments in cloud services and service providers in Europe.

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