“Infrastructure does not differentiate us in any way”

You’d think a cloud IaaS provider like nScaled would hate to see a sentiment like, “Infrastructure does not differentiate us in any way,” coming from the lips of a CIO. But quite the opposite – it’s why we’re here. When a business is ready to admit this to itself, they’re ready for our services.

I’m quoting from a great piece over at NetworkWorld, profiling Jim Honerkamp, CIO at Steel Technologies, and their recent move to the cloud. I’ve never met Jim, but I have to tell you – this guys gets it! He goes on to explain:

“Infrastructure does not differentiate us in any way, shape or form in the marketplace. To be a strategic IT organization, you have to be delivering value in technology tools, either to strengthen customer relationships or to be used as weapons against the competition.”

This is what Gartner refers to as “core vs. context” (and they probably got the idea from Geoffrey Moore). The idea is that you have to deliver both Core and Context, but you have to own Core while it’s okay to outsource Context. The point is to allocate your fixed resources (here, IT staff and budget) in the way that maximizes the value that both Core and Context deliver to the enterprise.

The trap that many IT teams fall into is getting stuck on the Context treadmill – OS patches, disk failures, hardware upgrades, backup schedules, etc. – and they end up under-allocating resources to Core stuff.

CIOs like Honerkamp understand this and take action, taking advantage of the cloud infrastructure services available today. They can choose amongst a variety of providers, and base their choice on price, architecture, service dependability, SLAs, support responsiveness, and more.

Some companies will get a better infrastructure than what they could build themselves (how many of you winced when Honerkamp said, “If someone hit a telephone pole on Shelbyville Road, they could take the whole company down.”?). Others will get the same capabilities for less cost. Some are driven by converting some of their CapEx to OpEx.

Whatever your motivation, take a hard look at your Core and Context, and ask yourself if your infrastructure differentiates your company in any way.