Companies May See Outsourcing in New Light, Thanks to Cloud


At its heart, cloud computing is a variant of outsourcing. Whether you outsource development resources (middleware-as-a-service), a full-fledged development platform (platform-as-a-service or PaaS) and/or enterprise applications (software-as-a-service or SaaS), you are offloading some of your technology functions to a third party.


I mentioned this in April, noting that companies sometimes neglect due diligence and ongoing relationship management with their cloud computing partners, maybe because they just don't view these relationships in the same way as their more traditional outsourcing relationships.


So naturally I was quite taken with Dion Hinchcliffe's inclusion of an outsourcing-related item in his ZDNet post called Eight Ways That Cloud Computing Will Change Business. (As usual, it includes one of his colorful diagrams to help illustrate his major themes.) We're already seeing all eight things Hinchcliffe mentions happening, though some are occurring far more quickly than others.


Item two on his list: Cloud computing will help create what he calls "a new lightweight form of real-time partnerships and outsourcing with IT suppliers." These relationships will offer companies more control and flexibility than traditional outsourcing arrangements, writes Hinchcliffe, largely because it will be easier to switch suppliers if you are dissatisfied.


This is largely true, though it won't be completely seamless to switch. Forrester Research analyst James Staten, one of the sources I interviewed for a recent story on cloud computing, pointed out that vendor lock-in can be an issue with PaaS because of its proprietary nature. He told me:

Right now, if you design applications on a certain cloud platform, it's the only place they'll run. You'll have to change the code to port it over to another PaaS.

Even with SaaS, it's important to keep mission-critical apps up and running. So any switches obviously need to be carefully orchestrated.


Among Hinchcliffe's other seven items: the rise of new industry leaders and IT vendors. This is mostly a good thing, though occasionally it can present problems since not all new vendors remain viable, as I wrote earlier this year. Just last week, IT Business Edge blogger Dennis Byron wrote about SaaS provider Flowgram shuttering its operations.


A couple of Hinchcliffe's other items:


  • The cloud facilitates creation of new products and services. The possibilities are virtually endless, writes Hinchcliffe.
  • The cloud creates greater awareness of the Internet and especially of Web 2.0 technologies. This may prompt companies to update their perspectives and skill sets in ways that will help them benefit from these technologies.
  • The business will become less reliant on direct IT involvement. Again, this is a good thing or a not-so-good thing, depending on how one looks at it, as I wrote last week. In that post, I shared some ideas from LucidEra founder Ken Rudin on which roles IT can play in helping the broader business create strategies based on leveraging cloud-based resources.


Hinchcliffe's other two points? Read his fine post (and dig that diagram).bus