Friday, March 5, 2010

Going Rogue: A Cloud Fable

The leadership within a certain division, let’s call it the BizDev division, of a fortune 500 company is entrepreneurial by nature and thus results oriented. BizDev is impatient with the red-tape required to get anything done. Capital expenditures are difficult to get approved and initiatives are equally difficult to resource, initiate, and complete. The leadership’s perception of their peers within the divisions from which they consume services is that because of resource constraints they have a basic reflex towards being obstructionists.

Being entrepreneurial, innovation comes naturally to the BizDev leadership team. They contemplated bypassing the corporate infrastructure and protocol for the greater good of their group. The BizDev team looked to the cloud for solutions to their bureaucratic woes. Using operational instead of capital expenditures for outsourced cloud services made sense to them. Implementing cloud solutions is quick, the process is simple, and if they stay mainstream, the vendors will be known quantities with effective and reliable track records. Why trudge the internal landscape when you can subscribe to existing solutions that satisfy the 80-20 rule. BizDev decided to roll the dice; guessing that the monolith didn’t have the appetite to stop them

BizDev was going rogue.

BizDev specializes in content management and as such has significant storage requirements. They looked to Infrastructure as a Service (IaaS) providers to solve their problem. Storing content at an IaaS provides them with the ability to increase and decrease their requirements in a self-service kind of way with virtually no red-tape. The BizDev team saw this as a no brainer and after a relatively quick selection process contracted with a vendor and began using their services shortly thereafter. The IT division with the company got wind of the cloud deal and although outwardly condemns the move doesn’t fight it and is actually relieved to get BizDev off their back.

BizDev’s gambit paid off. Over the course of several years, BizDev’s use of content management providers became more sophisticated by using specific vendors based on cost and functionality related to specific media. They also expanded its use of the cloud by encouraging its thought leaders to blog using the blog space of their choice and by actively using as many of the available social networking sites as possible.

Word of BizDev’s success in the cloud spread throughout the organization to other divisions. Many using the cloud for their own purposes; marketing, software development, legal services, ERP, CRM; you name the cloud service offering and it was being used somewhere within the company.

Although there was apprehension about the lack of governance over the use of cloud providers and the policies around their use, there was no appetite to take on a task that most anticipated to be a politically charged and multi-year project involving many resources. The use of cloud services was widespread and for the most was providing huge benefits with regards to speed to market, flexibility, and cost reduction. The cloud was considered a boon to efficiency that dramatically improved the organization.

Until the indictment.

The SEC came down hard on the company for alleged indiscretions related to business deals, profit forecasts, and accounting schemes. In addition to emails related to the executives of the organization, the opposing counsel is asking for all the marketing material related to BizDev and other business units to determine if fraudulent claims have been made about product effectiveness.

The company’s lack of governance over cloud resources is now making the process of providing discoverable resources to opposing counsel within federally mandated time frames untenable.

Where does all the marketing content reside? How do they capture what’s required and filter out what isn’t? Are the cloud providers prepared (and willing) to provide what’s requested by the opposing counsel? What are their retention policies and do they follow federally mandated regulations?

Have the respective business units maintained compliance with corporate policies related to external marketing? Is there a controlled and comprehensive set of messaging that’s contained in blogs and articles written by thought leaders? Are there any incriminating status messages posted by overzealous thought leaders in their favorite social networking sites? How does the company search for, retrieve, and provide social networking status messages for key individuals?

Although the cloud is becoming, and will continue to be, a direction for cheap and scalable solutions to common business problems, without governance business entities potentially put themselves in tenuous positions. The cloud is just another option like the myriad of other options for conducting business operations. And as such, cloud vendors should fall under the governance of corporate policies like any other vendor.

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