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Determining the Value of Cloud Computing

Betsie Estes
| Published: 9/12/2016 3:07 PM | Permalink | Email this Post | Comments (0)

Betsie Estes is a research manager with ISACA and has been with the association for 5 years

Utilizing cloud services can offer significant benefits to an organization—the ability to gain competitive advantage, break geographic barriers and reduce operating costs, to name a few. To realize those benefits, it is important that adoption drivers are aligned with overall enterprise goals and objectives and that business and cultural factors are favorable for adoption. Like any investment, cloud projects should be guided by the board of directors (BoD) to ensure value creation and optimization of risk.

The ISACA white paper Cloud Governance: Questions Boards of Directors Need to Ask provides a comprehensive overview of the value cloud computing can bring to an organization and the governance considerations inherent in adopting cloud technology. The white paper outlines the following questions that will help the BoD identify the strategic value of cloud services and the impact that the cloud could have on enterprise resources and controls:

  1. Do management teams have a plan for cloud computing? Have they weighed value and opportunity costs?—The risk of cloud adoption may be inconsequential when compared to the lost opportunity to transform the enterprise with effective and strategic use of cloud computing. The loss can be particularly great when competitive enterprises take steps to leverage those same opportunities.
  2. How do current cloud plans support the enterprise’s mission?—Cloud services should support efforts to achieve business objectives, which are derived from stakeholder needs. Cloud initiatives should have a clear and traceable link to the enterprise strategy so that the value expected from cloud services is clearly defined, accepted and measurable.
  3. Have executive teams systematically evaluated organizational readiness?—Evaluating the readiness of the enterprise in anticipation of the adoption of cloud services avoids the need for after-the-fact culture, skill or process changes to remove unanticipated pressure points. A systematic readiness assessment can help management identify additional costs and risk that should be factored into the decision process.
  4. Have management teams considered what existing investments might be lost in their cloud planning?—Cloud computing may not be an immediate and clean fit with the existing technology portfolio of the enterprise. The adoption of a cloud service may, for example, obviate already-made technology investments that have not reached their planned end date. The decision about when and how to realize that loss must be considered carefully.
  5. Do management teams have strategies to measure and track the value of cloud return versus risk?—Before deciding to adopt cloud computing, the board should give management teams the task of ensuring that proper reporting mechanisms are in place to measure value and risk aligned with enterprise goals.

By asking cloud-specific questions, boards will be able to determine whether the enterprise is ready to adopt cloud computing and whether the value created will have a positive impact on enterprise goals and objectives.

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