One of my favorite side projects in the cloud industry is meeting with technical leaders, mostly CIOs, and talking to them about the huge change that is coming with Cloud.

CIOs have already been faced with several major challenges.  We’ve seen huge cuts to IT budgets, the increased pressure to tighten security and compliance, and ofcourse, the rise in social media and mobile devices.  It’s not easy being a CIO these days.  Now cloud has come along and there is increased pressure for them to leverage these new methodologies to make the organizations lean, mean and innovative.  No pressure.

Of the biggest influencers, capital restraints, has resulted in CEOs and CFOs constantly looking for ways to reduce costs. This is why the idea of managed services comes up every now and then.  First we saw it with security, now we are seeing it apply to whole IT environments.  The problem with this is that now CIOs are busy defending his team against the allure of the cloud and it’s OPEX model. Not only can you now outsource most of your IT functions, but also your CIO!

Luckily, CIOs who run the risk of being outsourced have a great opportunity to look like a savior to the organization. Cloud savvy CIOs are starting to transition the IT department into an internal brokerage where they build internal services that rival those offered by cloud providers.  Other CIOs forego the internal build and leverage third party services orchestrated by their IT teams.

By transforming their department to one that creates value and can bill in-house departments, these new IT service departments share the OPEX across the whole organization, instead of carrying it under the IT umbrella. This means more innovation and more (hopefully) larger budgets to create projects that increase organizational value (and shareholder happiness). This is where the CIO can really shine.

So where to start? Well, a great place to start  is to look at your resources — those fabulous IT people who keep the organization up and running.  Run some numbers. Look at the amount of hours allocated to standard IT tasks such as configuration, management of infrastructure, troubleshooting, end-user support and dealing with obsolete resources. There is probably a significant amount of time that could be better used. If you are able to outsource all the tasks that are deemed to be a misuse of your team’s time (why pay a level-three IT employee to do level-one support?), think of all the potential you have to create more effective services that actually benefit the company!  These resources are now freed up to create new applications, process and actually start tackling those projects that the organization has been trying to do for years.

With the transition to cloud, CIOs have a chance to reinvent themselves as a strategic leader who can dramatically affect the organization on every level.  Cloud services are designed to help streamline organizations and provide better efficiencies, sounds a lot like the goals of the CIO in some cases.