Rethinking your sourcing model when entering the cloud

Roelof Louw, T-Systems SA

Roelof Louw, is an expert on Cloud Computing and he works with leading South African ICT outsourcing service provider, T-Systems

The proliferation of cloud computing, in whichever form, had led to a change in the way organisations approach their outsourcing strategies. Indeed, it has effectively moved from services-based approach to include specific bundled products – cloud computing in essence represents the next evolution in outsourcing.

Organisations now have to understand that their current sourcing model will not apply as it stands. It is really not as simple as adding cloud to a current model and running with it painlessly.

Cloud computing represents a fundamental shift in sourcing. Many companies have large data centres, stacked with servers and other impressive hardware, running in the background. In a cloud computing scenario this will not be the case anymore as a lot of services and resultant hardware will be hosted in the service provider’s dedicated data centre.

There is, therefore, a fundamental shift in thinking that companies have to consider when embarking on this journey. Cloud computing, which is at its core is both service and product-based, fits into a very specific part of the sourcing landscape.

Take a hard look

In order to understand cloud computing and how it impacts an organisation’s sourcing model you have to re-evaluate your current model.

For example if – as mentioned – do you currently run your own physical infrastructure and only outsource skills and support? In the cloud you will have to give up relinquish some control; a portion of both your systems and services will not be running on company-owned assets anymore.

And this brings us to your choice in cloud service provider. It is it critical that from the get-go, your cloud computing provider has to clearly set-out what it, realistically, entails to move over to the cloud.

It is really just the first phase of an encompassing journey. It is not as easy as returning from a business trip – where you’ve just read a great article on the cloud – to hop onto it and start reaping the numerous benefits. It doesn’t work that way.

And this takes us back to organisations’ current sourcing models. Giving up certain aspects might – in some cases – not be possible. A current sourcing model has been developed a certain way to meet the needs of the industry the company resides in, and importantly, abides to certain rules and regulations.

In these instances for example it won’t be viable to make a major change.  A reputable cloud provider, however, will be upfront about these challenges at the engagement phase; proclaiming that cloud computing is a service for all is a fallacy.


Fortunately, mature cloud providers have consulting processes in place that ensure that organisations very quickly have a real-life view of what aspects of the cloud will fit into their sourcing models and whether they’ll be able to use any of the services at all.

At T-Systems, the team – as part of its readiness survey – will assess the organisation on three levels:

Business processes, for example, applications and how it is integrated into the company; The entire IT infrastructure which includes networks, servers, storage; and data centre infrastructure . Services; this for example includes the supply and demand of IT services from assigned service providers (supply) to meet the needs of business units within the organisation (demand) and controlled and governed by a service aggregator based on IT services framework such as IT Information Library (ITIL).

Following a process, as the above, cloud computing providers will be able to provide organisations with a downright honest report on whether cloud computing is feasible.

Often some parts of the business will remain in-house. For example, if an e-mail system forms a fundamental part of an organisation and its service-delivery, it can’t be moved over to the public cloud – it’s too risky. In this case the e-mail system would have to stay in-house or migrated to a dedicated, hosted private cloud service.

Assessing readiness will also be able to demonstrate to organisations how their sourcing models will have to evolve to move to the cloud. It is really about managing expectations and ensuring that when organisations to embark on the first steps they do it with a realistic and clear path laid out in front of them.