Sea of Troubles

Harder Than It Looks: Cloud-sourcing in Regulated Industries

There’s an assumption by many that cloud computing will be the savior of the IT industry. Beset on all sides - by shrinking budgets and increasing demands - IT feels pressured, and the cloud looks like a miraculous escape [*]. By eliminating CapEx and the cost of massive integration projects for proprietary technologies, cloud solutions tempt us with the promise of simple, elastic, transparent OpEx models.

And it’s true. The cloud does offer a radically simpler version of computing. Taking a page from Apple’s book, these services target the median use case, tear out unused complexity and configurability, and radically improve the experience of what remains. Suddenly, IT no longer has to endure the long lecture about “why can’t we do x”; instead simply blaming the cloud provider.

But this leaves many, particularly those in governance roles, in a difficult position. What if that uncommon, underused functionality that was torn out in the name of containing costs is essential in a given industry? Or worse, demanded by a regulator over whom you have no bargaining power.

In this case, one is torn between two difficult positions: either wait on the sidelines with an increasingly uncompetitive cost structure and ageing technology, or risk a regulators wrath.

[*] Worse, SaaS solutions provide the business with an opportunity to sideline the IT department entirely, by self-sourcing both critical and emerging applications.