Why a cloud operating model matters

As much as cloud adoption is about embracing cloud-based infrastructure and applications, organisations that do not change the way they work will not be able to reap the full benefits of the technology.

Take financial processes, for example. With cloud services being consumed under an operating expenditure model, traditional budgeting methods would have to evolve to keep cloud costs in check.

Consulting firm Contino has developed a cloud operating model to guide organisations in their cloud journey. John Knight, transformation principal at the company, said the self-sustaining model is built out of loosely coupled components derived from building blocks.

In Contino’s blueprint, components would include team structures as well as technology and business capabilities, while building blocks would cover broader areas such as ways of working, whether it is agile or lean, as well as culture and talent, among others.

“A big part of achieving the goals that you want to achieve with cloud is not only about tools and techniques; it’s also about the strategy and your operating model,” said Knight, adding that Contino’s model can provide a more holistic picture for cloud adoption by organisations, including those in regulated industries.

But operating models are seldom set in stone. They need to evolve to keep pace with the changing technological, organisational and business landscape, which Contino’s operating model accounts for. For example, as software engineering teams embrace new development methodologies, changing the way they work, their technology capabilities would evolve as well.

Depending on the needs of its client, Knight said Contino will work with the organisation to pick the relevant building blocks and set achievable outcomes and metrics, before drilling down into areas such as technology capabilities, skill and team structures that are needed.

Carl Durrant, principal consultant at Contino, said this might involve setting up a cloud centre of excellence or a cloud business unit to help drive a successful cloud adoption or migration programme. “We use leading schools of thought in structuring teams and bringing them together to make this a success,” he added.

Despite the best intentions, cultural barriers often stand in the way of successful cloud adoption. Knight said this is often seen in large enterprises and those that tend to see challenges as technology problems that can be solved through a more rigorous supplier selection process.

“We tend to see a lot of these projects get funded out of a technology remit rather than being a holistic business remit,” he said. “So, CIOs and CTOs are very engaged, but perhaps not the wide breadth of the business.”

Contino recently applied its cloud adoption blueprint to help a large Australian insurance company achieve new levels of agility, security, efficiency, resilience, team engagement and innovation in its cloud adoption journey.

Knight said one of the first things Contino did was to help the company think about cloud as a product and all its nuances, including technical ones, to serve a business need, and then aligning team structures and taking team members through what they were accountable for.

At the end of the exercise, team members who had varying levels of understanding about their organisation’s state of cloud adoption ended up on the same page, having previously been in different domains and had not been talking to each other. Their satisfaction with current processes had also improved, said Knight.

“More importantly, they had auditable confidence that going through this new way of working was going to help them meet regulatory requirements as they now knew where everything was and made it faster and more efficient,” he added. “Plus, they have happier people.”